• Report: #31024
Complaint Review:

Progressive Insurance Company

  • Submitted: Wed, September 25, 2002
  • Updated: Fri, February 06, 2004

  • Reported By:cohoes NY
Progressive Insurance Company
PO Box 94618 Cleveland, Ohio U.S.A.

Progressive Insurance Company misrepresentation of New York Regulations nickel and dime you to death deceptive company that doesn't give a dam fraudulent ripoff business Cleveland Ohio

*UPDATE Employee: Accuracy is required in the insurance business.... they are merely enforcing policy.

*Consumer Suggestion: Bad Example


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I am a PART-TIME Registered Nurse who works in a hospital and will on ocassion, work a shift on a day off at another hospital. Progressive sent me a letter telling me they have reclassified me as a "business driver". This is an exerpt of the letter they sent. "Business use is defined as an occupation that is sales, service, or real estate related. It includes but is not limited to doctors or lawyers who visit multiple sites per day, the running of business errands, or vehicles owned or leased by a business or corporation."

When I informed them that I do not fit into any of these catagories, they said they have to revise the letter. They said even if you work at another site ONCE A YEAR OR LESS, you are a business use diver. I told them I do not represent or work for one hospital when do a shift at the other. They said it does not matter. When I told them I am part time, and therefore drive less to work then a full time person, they said that does not matter. So I presentated an example, I said, "So what if I were a clerk in a store, and wanted to pick up some more hours at christmas time at another store or even waitress during the christmas season". They told me that would be business use.
They then told me that New York State has regulations allowing them to do this. So I contacted New York State Insurance Department, wanting to know who sponsored this law or regulation so I could give them a piece of my mind. The state Insurance department said they have no such law or regulation. They encouraged me to file a formal complaint. Therefore, Progressive outright lied to me and misrepresentated New York State. Before I filed the complaint, I tried one more time to speak with progressive and was giving the same line, except they did not throw in New York State this time.

So in conclusion, if you have progressive as your insurance company, be warned not to earn any extra money, tell you boss you cant deliver his laundry to the cleaners, or drop off the payroll to the bank, and nurses, dont work at another hospital ocassionally to ease the nursing shortage, because progressive will take any extra money you make by increasing your rates. They will lie and deceive you so they can nickel and dime you to death.

Cohoes, New York

This report was posted on Ripoff Report on 09/25/2002 08:16 AM and is a permanent record located here: http://www.ripoffreport.com/reports/progressive-insurance-company/cleveland-ohio-44101-4618/progressive-insurance-company-misrepresentation-of-new-york-regulations-nickel-and-dime-y-31024. The posting time indicated is Arizona local time. Arizona does not observe daylight savings so the post time may be Mountain or Pacific depending on the time of year.

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Updates & Rebuttals

#1 UPDATE Employee

Accuracy is required in the insurance business.... they are merely enforcing policy.

AUTHOR: Mike - (U.S.A.)

Progressive didn't lie to you, they are merely enforcing policy. Insurance is an industry that requires accuracy in policy attributes. The company has a clear definition of what business use is, and it is important to rate vehicles that are used for business appropriately to coincide with the risk of insuring a business vehicle.

Progressive is one company that is VERY accurate with rating risks: statistically, the company currently operates on a 100/96 ratio - meaning that for every 100 dollars Progressive receives in premiums, it pays out 96 dollars in claims drafts and operating costs. In other words, they're making 4 cents on the dollar profit off your premium! (although that isn't bad for an insurance company really) The rest comes from investments, but who is willing to invest in a company that's not making profit? But at any rate, this leaves very little margin for error and even if maintained flawlessly can be easily offset by catastrophe's that cause insurance companies to pay out enormous amounts of money (think 9-11, california earthquake, hurricane andrew etc...)

Progressive is a very innovative company who is working constantly on new ways to better forecast risks. 5 or 6 years back, we tried a pilot program in texas where we installed GPS tracking systems on vehicles for 1000 of our insured who volunteered in Texas. The theory behind this was the fact that you could currently have 2 twin brothers living next door to each other, each with the same vehicle. Their insurance rates would be the same, even if one of them drove to the city 6 times a week for work and such while the other one worked down the street. (the latter of course being a significantly lower risk)

Anyhow, we tracked where people went, and how far they drove and it was basically "pay as you go" insurance. It's a great idea, because it encourages people to drive less to save money, therefore encouraging activities like "car-pooling" In the end, the average participant saved about 25% on their policy. The decision was made that the pilot was a bit ahead of it's time (GPS systems were more expensive when we did this, and some market research discovered some "Big Brother" concerns. But it's research that we, and a few other companies are looking at implementing in the future.

I hope that this gives you a little bit of insight as to exactly what is going on, basically an insurance company uses a variety of factors to try and determine rates, and all factors must be accounted for to accurately predict the risk of insuring a specific vehicle or driver.

Now on to the IRV issue, this is in response to the ex-progressive employee who posted the comment about personal vehicles being used by adjusters for business use.

When I first came to progressive, I worked in the loss reporting unit. The policy on this issue is that it's well, a non-issue. Any vehicle (owned by progressive or not) being used for business purposes while working for progressive is considered a "fleet" vehicle. (same as the IRV's)
So, while you are going out to meet with drivers or '09 damaged vehicles, whatever car you are driving (even if it is your own) is insured for the business use by progressive. If an accident took place with your car while working for progressive, your manager would have you call the loss reporting unit and progressive would handle it as a fleet loss. This even extends to rental vehicles from ERAC that they give you while traveling for training.

Kinda nice to be able to grab a brand new convertible and drive it like ya stole it >:D
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#2 Consumer Suggestion

Bad Example

AUTHOR: Preston - (U.S.A.)

I need to rebuttal to the following comment:

"example: Your son works part-time delivering pizza and (God forbid) gets into a terrible accident. If they find out he was working there when he bought the policy and didn?t tell them on the application, they would deny any and all claims. "

This is not business use. This is commercial use. There is a difference. Most private insurers will NOT even cover a vehicle which is used for commercial purposes.
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#3 UPDATE EX-employee responds


AUTHOR: Christopher - ()


I am an ex-employee of Progressive who worked in New York for four years. Unfortunately, I witnessed first-hand, and was sometimes forced against my moral judgment, to enforce the atrocious policies routinely applied to both claimants and our own insureds. Auto insurance is outrageously expensive in New York, second only to New Jersey I believe.

Unfortunately, many policyholders deliberately misrepresent themselves in order to get the lowest possible premium. Most embellish, or outright lie about who uses the vehicle, where or how it is used. This is very common and because so, Progressive puts a lot of effort in trying to identify accurate premium. They want to make sure you are paying the right amount.

Unfortunately, this effort is usually spent after the policy was sold to the insured by an independent insurance broker who does not explain to the insured, and usually doesnt care how the policy is rated.as long as they make the sale. Please understand, the broker is an independent insurance agent who sells policiesthats all.

Policy Services or Underwriting is the department, at Progressive, that is responsible for accurate premium & billing. Please make sure you know who you are dealing with. Now, I was a Claims AdjusterI dealt with accidents & reported claims. I can tell you that even I dont fully understand how Underwriting determines your premium. There are so many different variables they take into account, and different rating levels.

Believe me, its not as simple as choosing a commercial or private policy. But here is the part that will really piss you off. Im sure you have seen those white Progressive trucks driving around. (Thats what I used to do.) Because of corporate cutbacks, and the restructuring of job responsibilities, there are not enough trucks for every adjuster. (Each adjuster is now responsible for all aspects of their assigned claim and is pressured to complete as much of the claims process in the field.)

If an IRV (Immediate Response Vehicle) is not available, the adjuster must use their own transportation! Now that is blatant business use. No interpretation or clarification of definition needed here. You are using your vehicle to do you work duties. Now, business use is one of the biggest red flags that Progressive employees are trained to identify. If it is suspected, there is almost always a guarantee of premium increase. (The policy is re-rated).

If it is proven that there was misrepresentation at policy inception (you lied or withheld information on your original application) the policy will be cancelled without renewal and any claims during that policy period will be denied. Let me clarify with an example: Your son works part-time delivering pizza and (God forbid) gets into a terrible accident. If they find out he was working there when he bought the policy and didnt tell them on the application, they would deny any and all claims.

Can you see the irony? Its actually quite outrageous that Progressive would encourage, and sometimes force its employees to engage in the very same act it would punish its own policyholders for doing!! And one of our own employees had a Progressive policy! Unbelievable. I wonder if she too got re-rated for business use. I feel for you. My suggestion, go elsewhere. Good luck!
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