Car Insurance
Price of Paradise · Hawaii Public Radio · aired 1994-07-31
Guests: Linda Gilchrist (President, Hawaii Insurers Council); Richard Miller (Professor of Law, University of Hawaii)
Duration: 1:08:46

[00:00:00] Randall Roth: Good morning. This is Randy Roth, host of the Price of Paradise Radio Show. I don't know about you, but the topic of car insurance interests me. Three reasons come to mind. First of all, I don't really understand how it works. The basic concept is simple enough. I pay premiums and then when something happens, my insurance company pays for it, but I get lost quickly in the details, and I'm increasingly convinced that the devil is indeed in the details. Second, car insurance not only costs a lot, it costs too much. Maybe if I understood it better, I'd feel differently, but I doubt it.
[00:00:00] Randall Roth: Third, it supposedly is mandatory and yet everyone seems to agree that there are lots of drivers out there with no insurance at all. Hopefully, my guest today will be able to explain all of this to me. Linda Gilchrist is a chartered property and casualty underwriter, serves on the board of the Hawaii Insurance Bureau, and is president of the Hawaii Insurer's Council. Welcome, Linda.
[00:00:00] Linda Gilchrist: Thank you, Randy.
[00:00:00] Randall Roth: Also in the studio today is Richard S. Miller, a Professor of Law at the William S. Richardson School of Law. Dick specializes in the law of torts. He has written extensively about insurance law and has served on a number of special commissions working on insurance reform. Welcome, Dick.
[00:00:00] Richard Miller: Glad to be here, Randy.
[00:00:00] Randall Roth: Dick wrote an article that recently appeared in the Honolulu Advertiser's focus section. In it, he made some provocative statements about car insurance in Hawaii. Lest you think this scholar minces words, I'll read just the first sentence of that article. Quote, "If someone had set out to design the most dysfunctional auto insurance scheme for personal injuries possible, he or she could not have done better than to come up with Hawaii's current system." Dick, that's pretty strong language. Can you give us one or two specific reasons for this harsh assessment?
[00:00:00] Richard Miller: Well, to oversimplify a very complex problem, let me just mention three major points. First of all, the system overcompensates the small injuries and grossly and sadly undercompensates the large ones. Secondly, there are just too darn many uninsured motorists. Some estimate as many as 30% of all the people on the road have no insurance, even though insurance is mandatory in the state and even though most of us, being responsible citizens, buy our insurance.
[00:00:00] Richard Miller: And thirdly, the system couples the right to bring a lawsuit to the amount of medical expenses and economic losses. And that creates, as we'll see later on, a big problem. And the sum of that is that the state is hurting when it comes to auto insurance. O, overcompensation, U, too many uninsured motorists, C, coupling lawsuits and H, hurting the state. O U C H. That's what, what is that spell?
[00:00:00] Randall Roth: Linda, I'm not sure, but I think he said the system is screwed up. What do you think?
[00:00:00] Linda Gilchrist: Well, I certainly have to agree with Dick that we have a lot of problems in our auto insurance system in the state. I I agree with most of what he says. I guess the one thing I would take exception to is I do not believe that we undercompensate the severely injured person. Uh as a matter of fact, if you take a look at our bodily injury payouts, you'll find that they are six times higher than the national average. And I actually think that the individual that is damaged uh severely in the automobile accidents are fairly compensated. But it is true that we overcompensate those people with the minor injuries.
[00:00:00] Randall Roth: And I guess overcompensation for injuries is directly tied into these very, very high premiums that we face here in Hawaii?
[00:00:00] Linda Gilchrist: Absolutely.
[00:00:00] Randall Roth: And when we say overcompensate, does what does that mean? Is is there fraud or are we just generous or is it the high cost of living in Hawaii? Or do we have more ac-- Uh oh. Linda has something to say. What's the answer to all of that?
[00:00:00] Linda Gilchrist: Well, from my perspective, I think there are a number of different issues here, but one of the key ones is the fact that people in Hawaii are able to make money by having an automobile accident. And that is something that certainly insurance was never intended to do. Uh for example, if you're in an automobile accident in this state, uh there are a number of different ways that you can be paid twice for the very same loss.
[00:00:00] Linda Gilchrist: Uh loss of income or loss of uh money that you have to pay for medical services or something. So, you know, it's it's um it's like hitting the lottery. It's it's making, it's really making out if you have an automobile accident in certain situations.
[00:00:00] Randall Roth: Is there fraud? Are there people who are staging accidents or, or is it not a matter of fraud, it's just a flawed system?
[00:00:00] Linda Gilchrist: Well, I think it's both. We definitely have fraud. We're seeing more and more fraud in recent years. Uh we are seeing evidence of staged accidents. Uh we are seeing people come in and apply for automobile insurance with fake uh documents and so that they can get the automobile insurance and then turn in a claim right away. That is is uh becoming apparent within our system. But then there's the other situation where we just have over utilization because people do realize these are not necessarily people intent on committing fraud. It's it's honest individuals who all of a sudden find out that they can make money under this system.
[00:00:00] Randall Roth: It's opportunity and opportunity, correct. What do you think, Dick?
[00:00:00] Richard Miller: Uh I tend to uh agree with Linda on this. I think the the big, we've always had fraud in any insurance system, and I think one of the reasons we went to no-fault in 1973 was because the small cases tend to lend themselves to fraudulent claims. So that's going to be with us, uh no matter what kind of system we have. Unfortunately, the system lends itself to overcompensation even by honest people, because a lawyer has an obligation, for example, to to tell his or her client, uh what they can recover for their injury.
[00:00:00] Richard Miller: And one of the things a lawyer will tell them is that if your medical expenses exceed $10,000, then we can sue. And if we can sue, then we can recover um a lot more damages, because damages in a lawsuit are different from compensation for economic losses that we get under no-fault.
[00:00:00] Randall Roth: So you're suggesting that there is an inappropriate incentive for people to run up medical expenses so that they can qualify to sue?
[00:00:00] Richard Miller: Yeah, I think so. And I think in many cases that all the participants, including the victim, can justify in their own mind what they're doing.
[00:00:00] Randall Roth: I I predict that as soon as I give the number, we're going to have some plaintiff lawyers calling in and defending uh the system. But uh a couple of things I want to ask before we we encourage calls. Linda, is there more fraud here in Hawaii than there is nationally? Is that something that somebody keeps track of or is that something that you can only speculate about?
[00:00:00] Linda Gilchrist: Well, to a certain extent, we kind of have to speculate on it because while we can catch a certain amount of the fraud, uh we also know that a lot of it goes undetected. Um I do think that because of the way our laws are set up, that we have more fraud than some other states, but it's all relative.
[00:00:00] Linda Gilchrist: It depends on the system within the various states and the laws that apply. What has happened in Hawaii is that many of the other states have gotten very tough on insurance fraud. They have passed laws making insurance fraud a felony and what that has created is a situation where those people who are making a living out of committing insurance fraud have left those states and they're trying to find other areas where they can set up their shops. Hawaii is paradise for those people. You're telling me it's not a felony to engage in insurance fraud in this state?
[00:00:00] Linda Gilchrist: Actually, in Hawaii, we have no insurance fraud laws, and that's something that the Hawaii Insurers Council is working very hard to change. We hope to do something about that in the next legislative session.
[00:00:00] Randall Roth: I find this absolutely amazing. Isn't that isn't that covered by our ordinary fraud, the money getting money by false pretenses? Isn't that a crime?
[00:00:00] Linda Gilchrist: Well, it is a crime, but under the laws as they exist today, there uh and you know far more about this than I do. Uh but the you have to prove damages to somebody, it's just much more difficult. Also, the amount of money that has to be taken uh can depend on whether it's a felony, right, or a misdemeanor. And um if we had the insurance fraud laws, it would be more difficult to go after some of these situations and to actually prosecute.
[00:00:00] Randall Roth: You know Dick, you mentioned no-fault a little bit ago, and I think I kind of understand no-fault. Uh you have an accident and your own company pays even though it's not your fault. Is there more to it than that, or have I misstated it even in that clumsy attempt to simplify it?
[00:00:00] Richard Miller: No, you're correct. No-fault is really a form of ordinary accident insurance uh which covers not only the uh owner of the car but also the passengers in the car and perhaps pedestrians who are hit by the car and it covers them for their part of their economic losses uh if they are injured in an automobile accident.
[00:00:00] Randall Roth: Is is the basic rationale that with no-fault, you don't spend a lot of time and money or arguing over whose fault it is so that you save that cost and you just plain pay it off right up front. Is that the idea?
[00:00:00] Richard Miller: Well, that was the theory, and the idea was to deal with the smaller injuries in that way. You just pay off when someone is injured in an accident and you don't have to worry about whether anyone is at fault or not. The problem has come up that the amount of the losses is now tied in to whether you can also bring a lawsuit where the amount of money you might recover is much greater uh than it is under no-fault.
[00:00:00] Randall Roth: Are you telling me that that in a way we're worse under no-fault because before there wasn't an incentive to run up the the medical costs in order to file a lawsuit, now there is?
[00:00:00] Richard Miller: Well, I'm not sure whether they're worse off.
[00:00:00] Randall Roth: Okay. I think if we went back to, there is a recommendation out there to do away with no-fault and just go back to the system we had in 1972 and I think that would even be worse than what we have now. Well, why is it so expensive? If there's got to be more than just some fraud at work, because my daughter bought a car in Kansas recently, and I was shocked at how little the car insurance costs, and I'm annually shocked at how much my car insurance is here in Hawaii. What are some of the other explanations, if there are explanations, Linda, for our extremely high insurance rates?
[00:00:00] Linda Gilchrist: Actually, Randy, the the cost of the insurance is going to be based on the cost of the claims, uh plus of course the insurance company expenses, and those are the two factors that make up the insurance premium.
[00:00:00] Linda Gilchrist: The cost of claims in this state are very high. And interestingly enough, the cost of comprehensive claims are relatively low about average, I think for all the United States. But when you take a look at our PIP claims plus our bodily injury liability claims, What what what's PIP? Uh I'm sorry, the no-fault coverage. We call it personal injury protection. Here I am using jargon, and that's the part that Dick says is more screwed up than if we tried to screw it up, right? Uh that is correct. Although although one thing we have to consider, uh Dick makes some very valid points. But we also find those situations in states that have pure tort laws, because there's always an incentive when you can sue somebody else to try to make the damages as bad as possible so that you can build up as big a case as you possibly can. So that's that's true in the insurance system nationwide, I think, regardless of the law.
[00:00:00] Randall Roth: Okay. In case you joined us late, this is the Price of Paradise Radio Show. The topic is car insurance in Hawaii. My guests are Linda Gilchrist, an insurance company executive who currently is president of the Hawaii Insurers Council, and Dick Miller, a torts professor at the University of Hawaii School of Law, who is critical of our car insurance system in Hawaii. We are live and phone lines are open. Just call 955-8821. Neighbor Islanders are invited to call. Collect. The number again is 955-8821.
[00:00:00] Randall Roth: Well, earlier, I think it was Linda, was saying that somebody can sue and actually make money or make money from an accident. Dick, I thought the idea was that you would simply be compensated for your losses, and that suggests to me that you're just brought back up to where you would have been without that uh accident. What's going on?
[00:00:00] Richard Miller: Well, there is uh first of all, some some double dipping involved. Illegally or is this just No, it's the way the system works. Uh one, uh if you have your own uh accident policies and your own uh health policies, you you may get taken care of by those policies. In addition, you get uh you may get uh no-fault uh on top of it, which pays for medical expense, all your medical expenses and your earnings losses up to $1,200 a month up to a total of 20,000.
[00:00:00] Richard Miller: Then if you have a tort claim on top of that, you may get reimbursed for those same losses, and in addition, you'll get things like pain and suffering. Mhmm. Uh money for pain and suffering and also money for those economic losses that are not covered by no-fault. So you you're getting money from maybe three, at least two, maybe three sources. Some of it you have to pay back to the insurance company, but that's a real problematic situation. You don't really pay back to the insurance company what they've paid you. So you may end up better off than not having had the accident at all, in a economic sense.
[00:00:00] Randall Roth: I notice Linda is nodding that she agrees with all of that. If we had a guest seated here today who disagreed, what would they be saying? What's the other side? Who would defend this system that that gets double or triple compensation for an accident?
[00:00:00] Richard Miller: Well, we may get some people calling in who defend it, but uh Speaking of callers, we have somebody from the Big Island. Uh is it uh Kapooni, I believe the name is? Kapooni from the Big Island, you're on the air.
[00:00:00] Caller: I just wanted to make a comment regarding expenses the of the insurance company when you asked about that, and only two points brought in. I understand from my agent that the different companies have to underwrite the costs of the insurance given to DSSH claimants by the state. And that's a great big amount. We're paying for them.
[00:00:00] Randall Roth: Right, and just so our listeners understand, um people who are on some form of welfare, as I understand it Linda, they get their car insurance for free.
[00:00:00] Linda Gilchrist: They get the basic liability coverages for free. That is correct.
[00:00:00] Randall Roth: Who pays for that? I mean, there's no free lunch in life I'm told. Uh Well actually it's Kapooni, right? It's the same people who pay for all automobile claims. It's the public. We all share in the expense.
[00:00:00] Richard Miller: We all we also have an assigned claims uh feature, so that if someone is injured and there's no one to sue because the uh the the person who caused the accident is uninsured, we assign that claim to an insurance company that then has to pay it. And again, that comes back to all the insurance. To the good guys, to the good guys who are doing what they're supposed to be doing. But let me just add one other point. There's another factor in there and that's also insurance company profits, not just their expenses. A fourth a fourth factor. Kapooni, do you have any other comments to make?
[00:00:00] Caller: At this point, no. Thank you.
[00:00:00] Randall Roth: Thank you for calling. We have another caller from the Big Island, David, you're on the air.
[00:00:00] Caller: Yeah, this is a subject that I've been anxious to talk about for a long time. Uh as you're aware, uh the whole idea of no-fault insurance was that uh whenever there was an accident before no-fault, uh you had to go to court and decide who was at fault and then the insurance company paid the damages plus all the lawyer fees. So they said why don't we simply say if there's an accident, each person's insurance pays the damages and there are no lawyer fees because we don't determine who's at fault. And that was a great idea until the lawyers said, 'Hey, we're going to lose a whole lot of money.' So they ruined no-fault. What we should do is go back to real, honest to goodness, no-fault.
[00:00:00] Randall Roth: But David, let me let me ask Linda what she thinks of of your comment and um also what she thinks the answer to this situation is.
[00:00:00] Caller: Let let me let me just finish though before before you put her on. Uh the one thing we have to give up is the right to sue in an auto accident. Each of us has enough insurance to cover however much damages we want to cover ourselves for, but we can't sue somebody else who hits us.
[00:00:00] Randall Roth: Okay, let's see what let's see what Linda thinks about that and then Dick has a comment to make too.
[00:00:00] Linda Gilchrist: Well, actually I would have to agree with David. I think the the suit situation uh encourages people to embellish their claims, it encourages uh people to exaggerate injuries, and it is very costly um in any insurance, any state in the nation. Uh so I would agree with him. It is a difficult concept to get across, however, but we do have it in other lines of insurance like workers' compensation where if the employee is injured on the job, but they do not sue their employer. They are just paid out of the system, the Workers Compensation system.
[00:19:07] Richard Miller: And and if and if I'm correct, there's a lot of concern right now about that system that uh it's just too expensive.
[00:19:17] Linda Gilchrist: about the cost, and some of the problems there are the very same problems that we have in automobile insurance.
[00:19:25] Richard Miller: Okay, Dick. Uh I think also you have to remember that the tort system uh is designed to achieve some deterrence of accidents. That is to say that those people who negligently cause accidents are going to be held liable for the uh for the damages they cause. Now, in the auto insurance in the auto area, it's it's a weak argument because most people should have insurance. But deterrence is very important. And if you look at New Zealand, which has a no fault system, if you look at our workers compensation system, they don't seem to be working very well uh in terms of either fraud or uh deterrence.
[00:20:11] Richard Miller: So if if I understand what you're saying correctly, if if we couldn't sue because of somebody's negligence, more people would be more negligent. And that's true and part of the reason for that is not so much that people fear being sued because they also fear being killed in an accident, but because the insurance does increase the cost. It puts the cost of accidents on the driver and therefore drives out some people who who can't afford it. And that's what it designed to do. In theory. In theory, and we'll get to that in a moment. Linda, you've got another comment then I want to check with David on the Big Island. Go ahead.
[00:21:00] Linda Gilchrist: Well, I agree with you saying in theory, because I think because the insurance company is actually the one that pays the claim, I'm not sure that the tort system makes people more responsible. Like, I you know, they had the accident and then that's it. They don't know anything else about it until maybe they get their bill, and the insurance premium is a little bit higher, but nothing in relationship to the cost of some of those actual accidents.
[00:21:34] Richard Miller: David, are you still on the line?
[00:21:36] Caller: Yeah, I'm still on the line.
[00:21:39] Richard Miller: What do you think of those answers?
[00:21:42] Caller: Um, I I I I'm I'm not impressed. Uh, you know, the there was a article in the front page of our newspaper the other day and it said the courts are clogged with no fault cases. And a true no fault system does not go to court. The courts are not clogged with no fault cases. They're they're clogged with what the the lawyers have twisted things around and and screwed up the system.
[00:22:13] Richard Miller: Is it uh and and I and I just have to mention that week after week regardless of the topic, it seems like we lawyers Dick are uh at the heart of the problem. But uh who who who hires us, by the way?
[00:22:31] Richard Miller: Well, no, I I'm wondering, are we talking about, you know, if if we're going to point a finger, not to say it's your fault, but point a finger in the direction of of where change could be made. Are we talking about the legislature? Dick, is this something that that needs to be corrected by changing the law, and therefore it's the legislature that that needs to do something now or or you know, where do we point that finger?
[00:23:05] Richard Miller: I I think we have to go back to the legislature and get some real reform from them. The problem is that the presentations before the legislature frequently are very extreme on both sides, and it's very difficult for legislators to get the facts and to know what's right or what's wrong. So it becomes largely political. Either you're for no fault or you're against no fault. You're for the little guy or you're for the uh the fat cat. Linda Gelchrist, is your company one of those fat cats? Do you sometimes feel as though uh the the cards are stacked against you?
[00:23:48] Linda Gilchrist: Well, I wish we were a fat cat. It uh would make my job an awful lot easier and fortunately though over the last five years uh we have actually lost money on auto insurance in this state, and we are one of the larger insurance writers in the state.
[00:24:09] Richard Miller: David, thank you very much for your call.
[00:24:12] Caller: You're welcome.
[00:24:13] Richard Miller: Linda, I want to ask you, um, if I have an accident and and I'm thinking about filing a claim, uh, is it sometimes smart to not file that claim? In other words, are my insurance premiums going to go up as a result of the the claim that I file, uh, because I you know, I I I just don't understand that.
[00:24:39] Linda Gilchrist: Well, part of it depends on the accident itself and what actually happened. If you were at fault in an automobile accident and you filed a claim, it is very possible that your insurance rates will go up. However, um, we feel that everybody should turn in the claim to their insurance company. For one thing, you don't know about the other parties that were involved. A lot of times people say initially that they're not injured, but then a week or two goes by and their neck starts hurting them or something and so they'll turn in a claim later for uh the injuries. So it's really best to contact your insurance company after the loss, regardless of whether you think your rates are going to go up or not.
[00:25:34] Richard Miller: Okay, and I and I'm not finished talking about rates, but we have a caller from Moiliili. Shell, you're on the air.
[00:25:43] Caller: Hi, how are you today?
[00:25:45] Richard Miller: I'm fine. Did you notice I learned how to pronounce Moiliili since the last time you called?
[00:25:52] Caller: Yes, yes I What do you have today?
[00:25:55] Richard Miller: We all learn, don't we? Well, I hope so.
[00:25:59] Caller: Well, I'm I'm more than a little interested in this topic because this this uh no fault reform has been a passion of mine. I have a reason because I do not have insurance. Uh, I lost my I lost I drive? I rarely, but uh when I take my wife to her chemotherapy, yes, I drive my car.
[00:26:23] Richard Miller: Okay.
[00:26:24] Caller: Uh, I lost my insurance when my business partner died several years ago. And uh it took me several months, uh he was the engineer, I did the marketing for the company, uh the engineer died, I was out of business. I had to took me several months to get it together and I paid the rent and fed the cat. So three months later when I went back to get my insurance, I was told because I had not had auto insurance for quote uh and I believe me, I've got it all memorized. 30 days or more they were going to surcharge me 90%. Now, this is on a clean driving record with no points.
[00:27:12] Richard Miller: Shell, hold on a second. I want to get Linda's reaction to that, and then I want to come back to hear the rest of your your story. Now Linda is going to tell you they changed it last year. Right, Linda?
[00:27:30] Linda Gilchrist: Uh, correct.
[00:27:31] Richard Miller: Okay. Is that comforting, Shell, or or you're still kind of burning over that?
[00:27:37] Caller: Okay, all right. Now, uh so they changed it last year. So that must that must mean that it was inequitable, right?
[00:27:46] Linda Gilchrist: Uh, no, that's not the case. I wouldn't agree with that, but I think it comes down to another political issue uh where there are a number of people that uh were faced with that kind of surcharge, and the legislators felt that in the best interest of the consumers of the state uh that they would enact a law that said you could not um use those surcharges if they were not they were justified. Now, those costs are being shared by all of the policy holders within the state.
[00:28:23] Richard Miller: What cost?
[00:28:24] Linda Gilchrist: Well, actually, if you if you take a look, first of all, surcharge is in general, but Linda's going to say your actuarial tables show that people who drive without no fault are more likely to have an accident, right? Not necessarily more likely to have an accident, but it is true that in the insurance company's records when they take a look at those people who were carrying insurance in the past and those people who were not carrying insurance, uh in future years, the cost for the people who were not carrying insurance is going to be higher than for those who did have the insurance.
[00:29:09] Richard Miller: Shell, do you have uh That that that was as that was double speak. Well, Shell, I I think, you know, we've we've gotten uh, you know, your point has been well made and I think Linda has made very clear her response. You have another comment about that. Oh, yeah, we haven't even gotten into it. Now, they changed the law.
[00:29:35] Caller: Uh however, anyone that was ticketed for driving with no fault between that period of time, and it was Lord knows how many people there were that were ticketed because they couldn't back get back into the system because for some reason or another they'd lost their insurance for quote 30 days or more. Uh that is your backlog in the courts. That's a good portion of that estimated 60,000 people who are out there driving without no fault. I'd have insurance tomorrow if I could get back in the system. Another point, Hawaii is one of three states in the country that you cannot pay uh I believe like a quarterly.
[00:30:21] Caller: Uh so access to the system, I never hear mentioned. Act, let's talk about access to the system.
[00:30:29] Richard Miller: Let's talk about it. Dick, Linda, either one of you, Dick. Well, the the point I made in my article, and and uh I don't know as much about this as I know about some other elements is there seems to be uh an irrationality about the way the uh policies are rated. And the question whether increases in policy are justified by some statistics on on some statistical basis or whether they're arbitrary, I think should be looked into.
[00:31:02] Linda Gilchrist: Well, in uh the state of Hawaii, for an insurance company to apply a surcharge on a policy, that surcharge has to be approved by the insurance division. The only way the insurance division is going to approve the surcharge is if you have the statistical evidence to show that the higher premium is justified. Now, there is no other way to do it. And insurance companies that do have surcharges or credits that they apply to their policies have gone through that process and have been able to prove that either the additional premium or the lower premium is is appropriate.
[00:31:44] Caller: Uh well, I talked to those people and and I was told that that there's no such thing as an approval process. They file this thing and it's approved.
[00:31:57] Linda Gilchrist: No, I don't think so, Shell. I think if you go back, I don't know when you talked to them, but we have in this state now and this changed a couple of years ago also, we have a prior approval law. And we cannot charge rates until those rates have been approved by the insurance division and that applies to surcharges also.
[00:32:23] Caller: Well, they told me at the at uh when I got looking at this point we're talking about now, that technically no one has the authority to oversee that. You file it, they approve it. That's the way it's been done.
[00:32:40] Richard Miller: Okay, we'll just let the record reflect that Linda disagrees with that. Shell, you can make one more point, and then I've got some other callers that I need to uh go to.
[00:32:53] Caller: I talked to the uh uh after much ado, and I mean going down and and sitting on their doorstep, I talked finally to the administrative judge in Honolulu. He says, and may I'm reading my quote, it's a stupid law, you're getting screwed. And that is from the chief administrator of the the Oahu circuit court, traffic court.
[00:33:18] Richard Miller: Well, and uh if he's listening, call him up and tell him so. I guess if if there are folks out there that that are in agreement with uh with Shell or Dick or Linda, when somebody says that the system is somehow flawed, then I guess we as citizens need to figure out how can we try to change it. So, yeah, thanks a lot for calling. I really appreciate it.
[00:33:48] Caller: Thank you, Guys. I could I could go on for hours. I've been three years studying this.
[00:33:55] Richard Miller: Okay. Thank you, Shell.
[00:33:57] Caller: Mike here. Hi, thanks. I wanted to just quickly get back to the uh point about overcompensation for small claims and then um and then had a quick question about it. Um, and just a quick story. I had a friend that uh basically a good person and he was in a relatively minor auto accident about a year and a half ago. Um, nothing really serious and last year, or since that time, he's had over $8,000 worth of massages. He's had chiropractic care and he's had what amounts to a free membership in the health club for therapy.
[00:34:38] Caller: And I my point is I think that not only those type of people take advantage of the system, but I think people like chiropractors and physical therapists, and I want to see if you agree with this, um, who know that they're going to get compensation for treating what may or may not be an injury, I think they take advantage of the system too. And my question is what do you think could be done about those kinds of abuses and if you think that's part of the problem. And I'll I'll just leave and you can answer.
[00:35:20] Richard Miller: Thank you, Mike. Dick Miller, we're all basically good people and we all like a good massage. Uh, what do you think of the point that Mike is making?
[00:35:32] Richard Miller: Well, I first of all, I think that the there is going to be some element of fraud, but I think that a lot of people who are hurt, have pains can justify in their own mind the the treatment they're getting and I think even the the chiropractor, the massage therapist can say, well, this is a person who has a pain problem and we're going to help them out, so it's it's self-justifying. What's the problem in this system is that people are going to get that therapy not simply because they have pain and want and need the therapy, but because when they get it, if they build up the amount of expense to $10,000 the next step is to go to law, go to go to a lawsuit where they can get a lot more compensation.
[00:36:30] Richard Miller: And they may be encouraged to do that by everyone in the system, you see. So there isn't anything wrong with seeking treatment. It's just that you're seeing instances of people's over getting overtreated so that they can reach that threshold. Linda?
[00:36:47] Linda Gilchrist: I agree with Dick, but I also think that even in some of the smaller claims, we find people um are going for the massage therapy and and other types of therapy that really do not make the injury better. It's just that it makes the person feel better at that moment. And actually, massage makes us all feel better, you know, it would it would be nice for all of us to have. But most systems, if the treatment does not actually do something to make the injury better, it is not allowed. And and here in our state it is.
[00:37:30] Richard Miller: You're listening to the Price of Paradise Radio Show. I'm Randy Roth, and my guests are Linda Gilchrist, president of the Hawaii Insurers Council, and Dick Miller, a professor of law at the University of Hawaii. Listeners are invited to join in the conversation, just call 955-8821 if you would like to ask a question or make a comment. That number again is 955-8821, and neighbor Islanders are invited to call collect.
[00:38:00] Randall Roth: 30% figure, uh, anywhere near accurate, in your opinion?
[00:38:03] Linda Gilchrist: Well, it's hard for me to say whether it's accurate. I am sure that there's a high number of people who do not have insurance. Um, we find that in every state um, that normally about the lowest that any state has been able to get to, regardless of the system that they have, is about 20% of the people uninsured. Whether we have the 32% that was recently uh, cited here in our state, um, that's hard for me to say.
[00:38:30] Randall Roth: Dick, do you have any thoughts about this this problem of people on the road without insurance? Is that just something that's going to happen no matter how our laws read, or is that unique to what you've called a dysfunctional system?
[00:38:44] Richard Miller: Well, I think it has a lot to do with the cost of insurance in this state, uh, keeping in mind that we're a high cost of living state and the people are struggling for, uh, two or three jobs and, uh, if the cost of insurance because it is duplicative, it does, uh, double dipping that costs too much. If it goes up, then people can't afford it and therefore they're not insured. I think, however, that it can be remedied, and it has to, it really has to be remedied.
[00:39:15] Randall Roth: Okay. Linda, you have a comment, then we have some callers.
[00:39:18] Linda Gilchrist: The other problem we have in this state is sometimes it's very hard for people to buy automobile insurance. They have a difficult time in finding a company that will write it, and that's because we do not have enough competition within the state. And that directly goes back to the laws and the price of doing business in this state and, and of working under the system.
[00:39:41] Randall Roth: You're, you're inviting more competition with your insurance company?
[00:39:44] Linda Gilchrist: Well, sure. I, I, you know, as a company and as a company executive, uh, fine. Keep them away. But as a consumer, I know that competition helps any system. And it will keep prices down.
[00:39:56] Randall Roth: Okay, we have some callers. First, Deborah from Kailua. Deborah, you're on the air.
[00:40:01] Caller: Thank you. I have a question. If the massage therapy seems to be um, almost abused type of thing, why don't we just make sure that that isn't covered any longer?
[00:40:11] Randall Roth: Linda, do you have an answer?
[00:40:13] Linda Gilchrist: Well, if the insurance companies have their druthers, Deborah, they would just exclude it from their insurance policies and be done with it, but that's not the case. The law allows people to have those kinds of treatments, so we have to provide them. Now, what we need is a change in the laws.
[00:40:31] Caller: Okay, so that's a part for the legislature to see that this is a place where it's most often abused and could be remedied without too much problem, because as you said, everybody likes a good massage, but I don't think somebody else is supposed to pay for mine.
[00:40:47] Linda Gilchrist: Sure.
[00:40:48] Caller: And I don't like paying for somebody else's either.
[00:40:51] Randall Roth: Okay. Deborah, thank you for your call. We've got five people stacked up on the phone.
[00:40:56] Caller: All right. Thank you.
[00:40:57] Randall Roth: Uh, next uh, again from Kailua, this time Bill. Bill, you're on the air.
[00:41:02] Caller: Good morning, Ron.
[00:41:03] Randall Roth: Good morning.
[00:41:04] Caller: I had that experience a couple of years ago. I was unable to, I wanted to change my company when I was without insurance for 30 days exactly, because of illness. Right. And I went back, and I was told that I would be charged a $900 surcharge. I said, you can take it and shove it. And I turned on my heel and went out of the office. And I wasn't very long before I found the company that would handle it for me without any surcharge.
[00:41:33] Randall Roth: Yeah, well I guess that's the beauty of competition. That's what Linda was saying before. If you've got places to go, then then, you know, it's better.
[00:41:42] Caller: Yeah, I mean I was absolutely furious at such a high-handed business is that. That's ridiculous.
[00:41:47] Randall Roth: Right. Hopefully that company is not in business anymore.
[00:41:50] Caller: Oh, yes they are. Widely advertised.
[00:41:52] Randall Roth: Okay. Um, Bill, I'm going to have to go to some other callers. Yeah, take care. That's all I wanted to say. Thanks a lot, Bill. Dick Miller, you have something to say about Bill's comment?
[00:42:04] Richard Miller: Well, just that uh, one of the ways of finding what companies are out there and what they're charging is that every uh, once in a while the insurance commissioner publishes in the newspaper a list of all the auto insurers with a sample premium. So you can tell who's out there and uh what the sample premium is. And uh you may have a lot of choices, if you look around.
[00:42:28] Randall Roth: I haven't seen that for a couple of years and it's probably because I just missed it. Who could I call, Linda, to get the most recent version of that? Is there some place in the state that would provide that?
[00:42:42] Linda Gilchrist: The list is published by the insurance division and they do it annually. Yes, uh-huh.
[00:42:47] Randall Roth: Okay. That's great. Let's go to uh, Floral. Floral from the Big Island, you're on the air.
[00:42:53] Caller: Floral from the Big Island, are you still there? I am. Hello.
[00:42:57] Randall Roth: Great. Good morning.
[00:42:58] Caller: Good morning. I'm listening to you. I like your show a lot. Um, my name is Flora from the volcano area, and I am aware of a proposal uh in California, that was uh Andy Tobias proposed the financial writer that has uh insurance paid for at the gas pump with a surcharge there. What do the two uh commentators think of that idea?
[00:43:19] Randall Roth: Okay. Uh Dick Miller, what do you think?
[00:43:22] Richard Miller: Well, I think uh it's a it's a last resort. I would recommend that if we can't get a system that requires everyone to have insurance who's on the road, then as a backup, we perhaps ought to go to pay at the pump.
[00:43:36] Randall Roth: Linda, what do you think?
[00:43:38] Linda Gilchrist: Well, pay at the pump um is as long as you leave the same problems in the system that we have today, pay at the pump is just going to be a different way to pay for all of these abuses in the system. And actually also it's an inequitable way, because people pay the same premium regardless of the kind of car they drive, regardless of their driving record or whatever.
[00:44:02] Randall Roth: A good driver drives a lot of miles, pays more than a terrible driver who doesn't drive too much.
[00:44:08] Linda Gilchrist: That's correct.
[00:44:09] Richard Miller: Dick Miller, comment then we've got six people waiting on the line. Well uh it it's a way of getting people uh everyone into paying for the losses on the highway so it's fair. But I would not recommend pay at the pump unless we reform the system. The system has to be reformed first.
[00:44:27] Randall Roth: Because that would just hide the flaws in the system?
[00:44:31] Richard Miller: Absolutely.
[00:44:31] Linda Gilchrist: Absolutely.
[00:44:31] Randall Roth: Flora, thank you very much for your call.
[00:44:34] Caller: Thank you.
[00:44:35] Randall Roth: We have a caller from Maui, Becky, you're on the air.
[00:44:38] Caller: Oh hi. Actually, I was going to ask about pay at the pump, too, but I have another question. Um and I'm for pay at the pump but I I see some of your um uh comments make sense. But anyway, um, say I've been paying my insurance car insurance, you know, for two years or three years or four years or whatever, and I have a car accident, why does my rates go up? I've already been paying for it for the past how many years, you know? Why does it go up?
[00:45:10] Randall Roth: Great question, Linda Gilchrist. Why does your insurance company increase the rates at that point?
[00:45:15] Linda Gilchrist: Well, I'll go back to this idea of surcharges and the companies being able to show that the surcharges are justified. Uh first of all, a lot of companies for somebody who has been with them for four years, three years, uh they get what we call safe driver discounts. And in Becky's case, what can happen to you is that if you have the accident then you lose that discount, which of course makes the premium go up. But here again, these surcharges are justified. All it means is if you have 100 people without any accidents and 100 people with accidents, the group with the accidents are going to have higher claims cost in the next year.
[00:45:54] Richard Miller: Yeah, but the problem is that, uh, anyone at any time might be negligent in causing an accident, particularly when many of these this negligence is just momentary inadvertence. And so the statistical likelihood that that person is going to have more accidents, I think, is very much in question. I think there's a real problem there of automatically raising someone because they've had one uh, a negligent accident.
[00:46:17] Randall Roth: Okay, and I guess that goes to the the judgments being made by the insurance commission.
[00:46:23] Richard Miller: Right. Absolutely.
[00:46:23] Randall Roth: Okay. Becky, any other comments?
[00:46:25] Caller: Uh no, and thank you. It's it's really good to get all this out in the air. I certainly don't like paying everybody else's insurance.
[00:46:33] Richard Miller: I don't either. Thank you, Becky.
[00:46:35] Randall Roth: Okay. Uh our next caller is Ned from Kailua. Ned, you're on the air.
[00:46:40] Caller: I have a question about the surcharge, and if I'm repeating something, let me know and I'll stop. But I I would like to have someone explain how something like this happens. My wife backed into a fender in Safeway. The the cost of repair was $600 according to my insurance company. They have now charged my policy $800 a year for three years. So I'm paying $2,400 for a $600 accident. Now, the question the questioner just before this raised the question I had.
[00:47:08] Caller: My insurance for 1992 obviously cost me $4,000. So $1,600 plus $2,400, even though they called a surcharge. I was a $4,000 $2,400 deficit back then. What what was I buying, and how do they justify this outrageous overcharge?
[00:47:21] Randall Roth: Ned, I'm going to ask Linda and you know, Linda, I've heard stories like that before. And I got to tell you if I had an accident this afternoon, I would really wonder whether it was smart for me to make a claim or not. What do you think?
[00:47:38] Linda Gilchrist: Well, as we discussed before, I think um it's best to go ahead and file the claim. I know the surcharges are high, they will vary by insurance company. And one thing you should do is shop around and see if other companies are making the same kind of surcharge, uh see if you can get the insurance for cheaper someplace else.
[00:47:58] Caller: Well, I tried AAA and they're worse than the one I had.
[00:48:02] Linda Gilchrist: But then, on the other hand, if you go to a number of different companies and the surcharges are all the same, I think that's an indication that that all of these various companies have had to justify these surcharges.
[00:48:16] Caller: Well, let me get back to the basic question. How can they charge me $2,400 for a $600 expense?
[00:48:22] Linda Gilchrist: They're not trying to recoup the cost of that claim. As a matter of fact, insurance companies cannot do that. What they are trying to do is to collect premiums that will cover their future loss costs, and that's where we get into this issue. Um you know, is does is this really an indication of of uh the future loss cost going up? Insurance companies say it is and we actually have the stats to prove that. Now, I know that that's controversial.
[00:48:50] Richard Miller: Well, I just want to repeat again. I I just don't think that having the one accident is a is a good predictor of future accidents. So you're on Ned's side. Yeah and I have I also have another feeling. I think that the ideal world for an insurance company would be to have to pay no losses and just take in premiums. And that and that from a business perspective, that's what they work towards. It's reducing their risk or else overcompensating for it.
[00:49:18] Randall Roth: I'd like to get into that business myself. Ned, I really appreciate your call. We, we've got uh an abundance of calls and so I'm going to have to move on. Thank you again.
[00:49:30] Caller: Thank you.
[00:49:30] Randall Roth: Uh, John from Maui. John, you're on the air.
[00:49:33] Caller: Ah, yes sir. I um I have a no sh no in no uh uh no fault insurance and uh for the past uh oh, 10 years, I have that. And it seems I move from Honolulu to uh Maui, or I believe about a four years ago, and they uh uh changed the premium from an annual premium to semi-annual premium. And my insurance was doubled, and uh, not to say that I do not have any accident for the past five years. I just wondered that the increase of premium must be the cost, but uh Ms. Linda said the cost says uh something that uh um is a very important factor to the uh premium.
[00:50:13] Caller: Wow, ah, the components of cost, I I couldn't figure that out other than computerizing the data and uh claiming, and uh or if is that I have to share the cost for somebody else.
[00:50:24] Randall Roth: John, did your insurance premium double all at once, or was this over a period of time? Well, I receive a very courteous no this. They said that because our overall cost, the be so uh the annual premium will have to be semi premium, but uh almost just jump about the double for annual. Linda, is, is that uh common that somebody's premium would double? I have no idea. You know, whether you pay it once a year or twice a year, I guess the the most important number is the total.
[00:50:55] Caller: Oh, total is uh The total doubled, right John? Yeah. Linda, do you think? Well, two things two things to remember. Let's go back to the fact I cited earlier that over the last five years, the company that I work for has lost money in automobile insurance.
[00:51:11] Linda Gilchrist: So, basically speaking, the rates have had to rise substantially to make up for that. Secondly, a lot of times, we find when people tell us that their premiums have doubled that something has happened. There might be a surcharge on the policy, they might have bought a new automobile Would moving to Maui would moving to Maui make a difference? Um, moving to Maui uh can definitely make a difference. The location of the vehicle uh will be taken into effect in in calculating the rates. Yes.
[00:51:41] Randall Roth: John, thank you very much for your call. All right. Um my and my and uh my question is not fully answered because I do not think that that much cost uh uh factors were increased to double my premium just by converting from annual premium to semi premium. Thank you anyway. I think, yeah, I think our our guest would agree and and point to flaws in the system. I I they're they're both nodding that uh, John, your insurance is too high, and if we as a community can somehow figure out how to clean up the system, then those premiums are going to come down a lot. Thank you. Thank you, John.
[00:52:19] Randall Roth: Our next caller, Gary from Hawaii Kai. Gary, you're on the air.
[00:52:23] Caller: Thank you. I am I just went through the nightmare of trying to get insurance in this state. And uh one of the first things I did when I arrived here, was to call the insurance division of the state of Hawaii, the department of commerce and consumer affairs and asked for a list of the companies that carry and you know insurance here in the state. And they sent me a list and the list this was only about two weeks ago. The list is dated June 28th, 1992.
[00:52:53] Caller: So uh, first of all, I started calling some of these companies. About 2/3 of the companies are no longer in business here, and it seems to me that for someone who is trying to do the right thing to try to get insurance, it was just one big hassle and we're not getting the kind of help that we need from from our state offices.
[00:53:15] Randall Roth: You've you've touched some buttons here. Both of my guests have a hand in the air. Dick, why don't you go first? And then we'll have Linda comment. Well, uh, recently, the legislature eliminated the take all comers provision. So the insurance companies don't have to take all comers that request insurance. I'm wondering, Linda, and I'll ask you, assuming we really cleaned up the system and eliminated a lot of the potential for double dipping, etc., and the problems we have, would would the insurance companies be willing to go back to a take all comers policy, do you think? Would they support that?
[00:53:50] Linda Gilchrist: Well, I think the take all comers law actually in effect keeps insurance companies out of the state. I think one of the problems that Gary is finding is this issue of competition. In our state, we have about 180 companies that are licensed to write automobile insurance. That's a very small number. We only have less than 15 companies that are actively pursuing auto insurance customers. And just to give you an example, um, we've got other states that have far less premium than we have, and yet they have far more companies. Take Arkansas.
[00:54:22] Linda Gilchrist: They have uh about half as much premium as we have in this state, and yet they have 272 auto insurance carriers. That's 50% more than what we have. And we just um our laws do not encourage companies to come into the state and write insurance, and we need to correct that.
[00:54:40] Randall Roth: Gary, thank you very much for your call. Thank you, that's I agree totally with that. Thank you. In case you joined us late, this is the Price of Paradise radio show. My topic is car insurance in Hawaii, and the guests are Linda Gilchrist, an insurance company executive who currently is president of the Hawaii Insurers Council, and Dick Miller, a torts professor at UH School of Law, who is critical of our car insurance system here in Hawaii. We are live, the phone lines are open. The number is 955-8821.
[00:55:10] Randall Roth: And I would just comment that I think we could stay on the air for about two days and not get to all of the calls that we've had this morning. Let's do the best we can though, and I may be mispronouncing your name. Is it Kapunai on the Big Island?
[00:55:28] Caller: Kapunai.
[00:55:28] Randall Roth: Oh, Kapunai, I'm sorry.
[00:55:29] Caller: Thank you. Um my question is, what agency should be responsible then to initiate bills for the legislature, which will receive some positive reaction for the consumer?
[00:55:38] Randall Roth: I like that question. Dick Miller, if people who are listening are saying something needs to be changed, where does it start?
[00:55:46] Richard Miller: Well, we're in the uh uh beginning of a political season and an election and I think the question and uh the price of Paradise is moving, and I think we have to begin to formulate some questions, put them to our candidates for office and get some commitments from those people to reform the system. I think that's how it has to be done.
[00:56:07] Randall Roth: Okay. Linda Gilchrist?
[00:56:08] Linda Gilchrist: Actually, I think the bills are there. I the insurance industry very often introduces bills, the insurance division introduces bills. What we need is support from the consumer for tough laws that will correct the system.
[00:56:20] Randall Roth: Okay. Kapunai, what do you think?
[00:56:22] Caller: Uh, the bills are there, the comment about speaking to the um, well, I guess both of them related, get to your the voted officials, but they are the ones that work only on what is presented to the legislature or what is finally approved to move forward. And perhaps then the community really is is not uh aware of what is all the points that are so that they can follow and participate in the system. We usually find out in the newspaper after the fact.
[00:56:51] Randall Roth: So we need a more open system, more community involvement.
[00:56:55] Caller: Well, more information on the media part, I think.
[00:56:58] Randall Roth: Okay. Dick Miller who hap to be on the media council as a comment, and then we'll, we'll go to another caller. Go ahead.
[00:57:02] Linda Gilchrist: A couple of years, a couple of years ago, the an outfit called Care, which was composed of a Union executive and, I guess, in cooperation with the insurance companies drafted some legislation, which was actually passed. In my view, in some ways it made things worse, unfortunately, especially by lowering the amount of mandatory liability insurance from 35,000 to 25,000. Um, but, that's one way to go, to find some group that's willing to introduce legislation and to push it. And by the way, I understand that my recommendations that I put in the newspaper a few weeks ago are being fashioned into a bill, which may come out of Bundes committee, I think.
[00:57:14] Randall Roth: Oh, that's good. Linda Gilchrist, a comment.
[00:57:15] Linda Gilchrist: Actually, I think that bill made things better in my mind. If we go back, that was passed in the '92 legislative session, uh, insurance companies for the most part since then have not raised rates, and if we look at the pre-92 history, uh, we found that companies were coming in with some fairly large size increases, mainly, uh, double digits, some one as high as, you know, 40%, 20% and in that area, and to have rates stabilize uh with some companies even taking rate decreases since 92, to me is a success for the people of this state.
[00:57:26] Randall Roth: Okay, Kapuni, I really appreciate your call.
[00:57:27] Linda Gilchrist: Thank you very much.
[00:57:27] Randall Roth: Uh let's see how many we've got five minutes to go and a zillion phone calls to take. Let's go to John in Connie Ohe next. John, you're on the air.
[00:57:31] Caller: Yeah, thank you very much. How do people without insurance get through a car safety check? I've got to show my receipt for insurance when I get my check.
[00:57:34] Randall Roth: This is a great question. How do those 30% or 32% that are on the road without insurance, how in the world do they get that safety check, Linda?
[00:57:37] Linda Gilchrist: Well, John, you know, legitimately you've got to go and get the insurance to get the safety check. We do know that there are a lot of fraudulent no-fault cards out there and I suppose that's how some of them slip through. Uh we feel that's another reason why we need the fraud bill. Um, but I, you know, I don't uh I don't know how they get through John. That's a mystery to all of us.
[00:57:46] Richard Miller: Is it is it possible that what they do is uh get insurance, uh go get their safety inspection and then cancel immediately?
[00:57:48] Linda Gilchrist: I think Dick uh has probably a big part of the answer.
[00:57:49] Randall Roth: Maybe we shouldn't be talking about this publicly.
[00:57:50] Linda Gilchrist: I thought of that afterward, yes.
[00:57:51] Randall Roth: John, thank you very much for your call.
[00:57:52] Caller: Okay, thank.
[00:57:52] Randall Roth: The next call is from Ron. Ron on Maui, you're on the air.
[00:57:54] Caller: Hi, thanks. Uh my question is, you know like yourself said that you wonder whether to file a claim when you have an accident or not. Right. It seems like auto insurance now is getting to the point where people are getting it just to protect their assets, like if they have a home or, or if they have, you know, assets that they want to protect. Mhm. That seems an important thing. Well and I think Dick Miller was commenting earlier that that we don't really have enough insurance to cover our, our assets. Yeah so so that's my point. The point is like you said there's about 30% of people who are driving on the road without auto insurance and and I would guess that of those 30%, the overwhelming majority of them don't have assets. So why should they get insurance, auto insurance? There's you know why pay $1,000 a year for auto insurance where Other than the fact that the law says they're supposed to have it. Dick, Dick Miller has a comment to make, Ron. Right, right. I, I think that uh there's uh both a a civic responsibility and a moral responsibility for anyone who's driving on the highway to to be prepared to meet the costs of negligently caused injuries that they cause. Right, right. But I think when you come down to the nuts and bolts, Dick, you know that doesn't cut any ice to a lot of people. That's why a lot of people don't have insurance. Anyway, anyway, my final comment is I'm not a real big fan of Mayor Fasi who's running for governor. But I really do agree with him on the one point that pay at the pump is the fairest way. You know like other other than that, my point of view is that the insurance companies and the lawyers are the ones who are going to make out. My son was in two accidents and and and I've been paying insurance for 20 something years and it ended up where when we claimed it, we ended up paying for the accident because with the premiums, right? Yeah with this you know, and I think the insurance companies are just scamming and they got the numbers, they got the actors and Linda's solution is more competition but I don't think you know, people the average Joe like myself, have the time and want to and go go go around calling 20 insurance companies and comparing prices and you know, I mean, that's ridiculous. Shop, Yeah. Ron, I really appreciate your call. We've just got a minute and a half left and I've got three people who have been waiting a long, long time. Thank you. Thank you. I want to try to get to all three. Steven Hawaii Kai, you're on the air. Hey, uh this seems to me that the insurance problem is related to a lot of other problems and I'd like to see some discussion of the interconnection between insurance and too many cars on the road and too much population growth and not enough public transportation. And I would like to suggest that uh the state pay at the pump idea provides free insurance for everyone um, use and raise the costs of driving to a point where we drive a lot of cars off the road. Use the proceeds from the uh higher costs for driving to provide the free insurance and also to provide the a greatly increased public transportation system. Two comments. Linda gave me a look that said there's no such thing as a free lunch, and the basic question that you asked is such an excellent question, I'm going to have an entire show devoted to that one. Um sometime in the next couple of months, we're going to talk about the whole issue of population and the implications of all of that. Thank you very much for your call. Okay, bye-bye. Again, um oh we're running out of time. Um Mori and James uh two of the many many people who called in. I'm I'm sorry even though you waited a long time, I'm just not going to be able to get to you. Want to thank everybody who called and everybody else who tried to call this morning. Uh we really had an awful lot of interest in this topic. My guests have been Linda Gilchrist, President of the Hawaii Insurers Council, and Dick Miller from the UH School of Law. Today's show was produced by Susie Roth with help on the phones from Wally and Tom Roth and technical support from Jeff Ilardi. Tune in next week when Ken Mortimer will be on hand to tell us about his hopes, fears, and plans for the University of Hawaii and to answer your questions. It promises to be a great show. Governor will be our guest the week after that and it too should be interesting. You've been listening to the Price of Paradise Radio Show. I'm Randy Roth. Aloha.
[00:59:00] Randall Roth: do they get that safety check, Linda?
[00:59:01] Linda Gilchrist: Well, John, you know, legitimately, you've got to go and get the insurance to get the safety check. We do know that there are a lot of fraudulent no-fault cards out there and I suppose that's how some of them slip through. We feel that's another reason why we need the fraud bill.
[00:59:13] Caller: But I, you know, I don't uh I don't know how they get through John. That's a mystery to all of us. Is is it is it possible that what they do is uh get insurance, uh go get their safety inspection and then cancel immediately?
[00:59:23] Linda Gilchrist: I think Dick uh has probably a big part of the answer.
[00:59:26] Caller: Maybe we shouldn't be talking about this publicly.
[00:59:28] Linda Gilchrist: I thought of that afterward, yes.
[00:59:29] Caller: John, thank you very much for your call. Okay, thank you. The next call is from Ron. Ron on Maui, you're on the air. Hi, thanks. Uh my question is, you know, like you so said that you wonder whether to file claim when you have an accident or not. Right. It seems like auto insurance now is getting to the point where people are getting it just to protect their assets, like if they have a home or or if they have, you know, assets that they want to protect. Mmhmm. That seems important thing. Well, and I think Dick Miller was commenting earlier that that we don't really have enough insurance to cover our our assets.
[00:59:55] Caller: are really serious. Yeah, so, so that's my point. The point is that you said there's about 30% of people who are driving on the road without auto insurance. And and I would guess that of those 30%, the overwhelming majority of them don't have assets. So why should they get insurance, auto insurance. There's, you know, why pay $1,000 a year for auto insurance where Mmhmm. Other than the fact that the law says they're supposed to have it, Dick Miller has a comment to make on, Ron. Right.
[01:00:15] Richard Miller: I I think that uh there's both a civic responsibility and a moral responsibility for anyone who's driving on the highway to to be prepared to meet the costs of negligently caused injuries that they cause.
[01:00:23] Caller: But I think when you come down to the nut and bolts, Dick, you know, that doesn't cut any ice a lot of people. That's why a lot of people don't have insurance. So, I would Anyway, anyway, my final comment is I'm not a real big fan of Mayor Fasi who's running for governor, but I really do agree with him on that one point that pay at the pump is the fairest way. You know, like other other than that my point of view is that the insurance companies and the lawyers are the ones going to make out. My son was in two accidents and and and I've been paying insurance for 20 something years, and it ended up where when we claimed it, we ended up paying for the accident because with the premiums, right? Yeah, with those. You know, and I think the insurance companies are just scamming, and they got the numbers, they got the actuaries and Linda's solution is more competition, but I don't think, you know, people, the average dollar like myself, have the time or want to and go go go around and calling 20 insurance companies and comparing prices and, you know, I mean, that's ridiculous. Shop Shop
[01:01:09] Caller: Ron, I really appreciate your call. We've just got a minute and a half left, and I've got three people who've been waiting a long, long time. Thank you. I want to try to get to all three. Stephen, Hawaii Kai, you're on the air.
[01:01:19] Caller: Hey, uh it seems to me that the insurance problem is related to a lot of other problems, and I'd like to see some discussion of the interconnection between insurance and too many cars on the road and too much population growth and not enough public transportation, and I would like to suggest that uh the state pay at the pump idea provides free insurance for everyone, um use and raise the costs of driving to the point where we drive a lot of cars off the road, Stev use the proceeds from the higher cost for driving to provide the free insurance and also to provide a a greatly increased public transportation system.
[01:01:45] Caller: Two comments. Linda gave me a look that said there's no such thing as a free lunch. And the basic question that you asked is such an excellent question, I'm going to have an entire show devoted to that one. Um sometime in the next couple of months, we're going to talk about the whole issue of population and uh the implications of all of that. Thank you very much for your call. Okay. Bye-bye. Again, um, oh, we're running out of time. Uh, Mori and James, uh, two of the many, many people who called in. I'm I'm sorry even though you waited a long time. I'm just not going to be able to get to you. Want to thank everybody who called, and everybody else who tried to call this morning. Uh, we really had an awful lot of interest in this topic. My guests have been Linda Gilchrist, President of the Hawaii Insurers Council, and Dick Miller from the UH School of Law. Today's show was produced by Susie Roth, with help on the phones from Wally and Tom Roth, and technical support from Jeff Ilardi. Tune in next week when Ken Mortimer will be on hand to tell us about his hopes, fears, and plans for the University of Hawaii, and to answer your questions. It promises to be a great show. Governor Waihe'e will be our guest the week after that, and it, too, should be interesting. You've been listening to the Price of Paradise Radio show. I'm Randy Roth. Aloha.
[01:02:22] Randall Roth: use and raise the costs of driving to the point where we drive a lot of cars off the road, use the proceeds from the higher costs for driving to provide the free insurance and also to provide the greatly increased public transportation system.
[01:02:22] Richard Miller: two comments. Linda gave me a look that said there's no such thing as a free lunch, and the basic question that you asked is such an excellent question, I'm going to have an entire show devoted to that one. Um some time in the next couple of months, we're going to talk about the whole issue of population and the implications of all of that. Thank you very much for your call.
[01:02:22] Randall Roth: Again, um oh, we're running out of time. Mori and James, two of the many many people who called in. I'm I'm sorry even though you waited a long time. I'm just not going to be able to get to you. Want to thank everybody who called and everybody else who tried to call this morning. Uh we really had an awful lot of interest in this topic.
[01:02:22] Randall Roth: My guests have been Linda Gilchrist, President of the Hawaii Insurers Council, and Dick Miller from the UH School of Law. Today's show was produced by Suzie Roth with help on the phones from Wally and Tom Roth, and technical support from Jeff Ilardi. Tune in next week when Ken Mortimer will be on hand to tell us about his hopes, fears, and plans for the University of Hawaii and to answer your questions. It promises to be a great show. Governor Wahea will be our guest the week after that and it too should be interesting. You've been listening to the Price of Paradise Radio Show. I'm Randy Roth. Aloha.