AAA, Automobile Club Of Southern California is running the biggest scam! CHECK THE MILEAGE THEY HAVE ON YOUR VEHICLES A YEAR! Murrieta California
BEWARE!!! AAA( Automobile Club of Southern California) is running the biggest scam! CHECK THE MILEAGE THEY HAVE ON YOUR VEHICLES A YEAR! Take a good look at your bills(past & present). I was organizing old records and notice the mileage of one of our vehicles (1987 truck) and the mileage that was listed was 50,000 + miles a year ( insurance for 6/2006-6/2007). A new renewal was coming up for 2007-08. I then looked a past bills and notice the years previous (2004-05) was 1-5000 miles which was correct. But I didn't have a statement for billing on (2005-06).I called AAA 1800 number and asked if the our premium costs were based on the yearly mileage? Answer: YES! I then asked for the rep on the phone to check my records for 2005-2006 and tell me what mileage they had us down for that year. He said they had us down for 63000 miles + ( then made a comment that we would have to drive around the earth 3 times in a year to rack up that many miles) I agreed and said the 87 truck drives to work 5 miles and home 5 miles 5 days a weekor 2400-3000 miles a year..he said they would look in to it.I told him my rates were doubled because of their mistake and expected a full refund including interest we had to pay for both years and to make sure it was corrected on my upcoming renewal. I then went to my local office in Murrieta, ask for a print out of billing record. Told agent about it and he said they would look into it. 3 days later I received a phone call within a few days from the district manager telling me they couldn't do anything about the mileage on the previous bills, that the mileage was what we had put down. I then told him NO it was a mistake and I wanted proof that we put that down number one & that my husband had taken over paying bills and if we made the mistake the computer program or person entering data should have flag such an increase which no one could possibly drive in one year. I then told him I had been a member for 20+ years and they had all past records to compare to. He told me thir records are from our smog report and we had to prove the mileage, bring truck into their office have a agent check odometer. I told him I wanted a copy of the revised billing showing correct amounts as well as mileage for my records . We brought in truck and waited. May 4th B.M from AAA called and said they would refund me $261.00 for 2006-2007. I told him the year before that needed to be corrected as well. He said he would look in to it. Received ck for amount above but no interest. Also revised billing that was not correct it did not include the Less policy holders dividend (which make the bottom line higher).The amount it should have shown was $991.00 for that year instead of $1194.00. call 1800 number listed on letter if there was a problem with the amounts,was told to call person who is doing the work on our account so far. Called AAA B.M. an left message (wasn't in). Received call from AAA Business manger and was told the mileage was corrected on his records. I said really well its wrong because AAA local office gave me a fax showing the higher mileage. He asked me to send him proof, via fax . I said what are you talking about AAA sent the fax surely they have record of the mistake & correction! He said he couldn't get that information! I said NO I wont fax it, I will bring it in. He said well I will be gone by 4pm ,I said I am right around the corner from you office will be their in 5 minutes. He looked at the faxed previous bill and the record he had on his computer and said it was 216.00 over charge on our bill I told him yea and I wanted the interest from this billing and the other bill as well. He said he would put in for that as well. Got check for 216.00 but STILL NO INT. Then received new renewal 6/2007-6/2008 and I couldn't believe my eyes they had us down for 25,000 to 30,000 miles a year ( instead of the 1,000-5,000 miles we drive)!!!The bill was again double, what it should have been. Now I have to fight this thing all over. I will be asking the insurance commission for a complete audit on AAA( Automobile Club of Southern California).I just wonder how many people they have done this too and got away with it. Cathy murrieta, California
U.S.A.
1 Updates & Rebuttals
AAA Annie
Costa Mesa,California,
United States of America
Letter to Thomas V. McKernan explains why this happened to you!
#2UPDATE Employee
Thu, January 12, 2012
November 17, 2011
Re: The Auto Club of Southern Californias Verified Mileage Program
A Misrepresentation by AAA Agents Regarding Insurance Premiums and Rates
Thomas V. McKernan
CEO Auto Club Enterprises
3333 Fairview Rd
Costa Mesa, CA 92626
Dear Mr. McKernan:
The Auto Clubs Verified Mileage Program or Pay as You Drive Program was approved by the Insurance Commissioner earlier this year and was touted as a way to save consumers money by lowering the price of insurance when they drive less. In theory, the program has its merits by discouraging unnecessary driving by motorists. In reality, the Auto Clubs implementation of the program has many troubling flaws.
Auto Club agents are pressured to forge insurance documents and manipulate insurance premiums in exchange for more phone duty, better phone calls, better leads, paid vacations, better treatment by management, a trip to the Bahamas, and to maintain their employment. Ethical agents are threatened and harassed to quit or accept their fate that they will be terminated for low performance. High production is looked at as a virtue and not scrutinized as agents submitting fraudulent business. Low production is looked at as laziness, incompetence, stupidity, and reason for punishment and termination. Lead distribution is such that high producers are given more leads and low producers are given even less leads insuring a huge gap between high and low producers. It also skews the policies written with integrity verses policies that are problematic.
Rather than estimate the accurate or actual mileage for each policy, agents are lowering initial mileage readings when starting a policy, which lowers the annual mileage category and thus lowers the annual premium, but just for that year. Agents that use this practice to quote will sell more policies because the premium will be much lower than it would otherwise be. Agents can accomplish this because only about 25% of all policies require inspections with an odometer reading. Agents at the district offices are allowed to inspect their own vehicles. They omit odometer readings intentionally and enter any figure they want to sell the policy.
All this would be a moot point; however, with the Verified Mileage Program insureds are required to submit their exact mileage reading upon renewal of the policy or be removed from the program. Through no fault of their own, many Auto Club insureds will have renewals with extraordinarily higher mileage depending on how much the agent lowered the original mileage and how many miles were driven during the current policy period.
An example to illustrate the wrong that is being perpetrated on unsuspecting consumers: If I start a policy today and my current annual mileage is 15,000 and I bought the car exactly a year ago, with zero miles, the mileage category should be 15,000 miles or less. The agent knows if he quotes me at 15,000 miles per year I wont buy the policy so he enters my mileage at 5,000 and my premium is much lower than what I am paying now so I switch to the Auto Club. Im happy until my renewal arrives next year. The premium almost doubles in price. When I am asked by the Auto Club what my current mileage is next year, it will be 30,000 because if you remember I was driving 15,000 miles per year and my vehicle had 15,000 miles at the inception of the policy. The Auto Club is going to rate my renewal at 25,000 miles per year because my agent entered 5,000 as my current mileage at the time I purchased the policy. The renewal will encompass the miles that were deficient from the prior policy (10,000) and include the actual miles driven (15,000). My annual mileage rating goes from 5,000 per year to 25,000 per year because it looks like I drove all those miles in only one year. I really didnt drive that much but that is the way the miles are calculated. Thats a big increase. If I complain, I am told by the representative that I am a liar and can bring in a service receipt in 30 days to lower my mileage to where it should be. Now that is customer service! Some in the company may say the miles are being accounted for over two years so it really doesnt matter. This is all being suppressed by the sales department. My view is the original sale would not have taken place and the premium manipulation has put the insured into a situation where the policy is written under false pretenses and can be voided by the insurance company.
The agent doesnt care because all this stuff will happen a year later and he sold a policy he normally would not have. The Auto Club praises the current agent and lavishes him with more phone duty, pays him more per policy, and sends him on paid vacations because he is a top producer and gets away with doing this on a daily basis. Nobody seems to notice except our insured. On the renewal the policy is way over priced and the insured non-renews or has to fight with our customer service department that wont believe him. The insured doesnt know exactly what happened because they did not see the fraud that was committed against them. The fraud only becomes apparent on the renewal a year later. The insured has lost all longevity with their prior carrier because they are now with the Auto Club. Their current renewal is too high so the insured must shop for insurance elsewhere.
The only way to eliminate the out right fraud and corruption at the Automobile Club of Southern California is to require inspections with odometer readings for every policy written. Currently, inspections are not required for liability only policies or insureds that have prior insurance with similar coverage. Also, agents in the field can perform their own inspections and omit the odometer photo on purpose! This lack of accountability on new policies opens the door for agents to commit fraud and abuse on the unsuspecting public. This is a verified mileage program so you must verify the mileage, or otherwise this is a sham and should be abolished. Also, allowing the same agent that writes the policy to inspect the vehicle is a flagrant conflict of interest. The inspection should be completed by a manager or impartial third person at all levels of the organization and at all times include a photo of the odometer.
There should be a separate disclosure just for mileage in the insurance documents that require the exact mileage for each vehicle to be listed at the inception of the policy. The insured should be required to sign the disclosure verifying the exact mileage for each car on the policy. There should be an explanation that this figure will be used to determine next years mileage calculation. Unbelievably, this is not now required. The mileage would therefore be verified by the insured, by an inspector, and by the agent. The current system allows for only the agent to verify the mileage and the agent has a conflict of interest to be trusted with that. Currently the only disclosure that references anything about mileage is on the Coverage and Limits page and this only lists what the annual mileage is calculated at. This is misleading if the insured doesnt know what their real annual mileage is or how it was calculated. Most insureds dont know what they drive and are influenced by the agent. When you ask an insured how many miles they drive, they most likely under estimate. This figure should still be listed in that location but the mileage disclosure should list the exact miles at the inception of the policy. There is a culture of corruption within the Auto Club of Southern California and drastic measures are needed for true change to be forthcoming.
The Auto Club will defend its position by stating it has systems in place to catch fraud and abuse and to some extent they do. However, the only way to avoid agents from lowering mileage is to educate the insured with a mileage disclosure that must be signed by the insured and the agent. It should explain how this figure will affect the rating for the following year. When only some of the policies require inspections, and this can be manipulated by field sales agents, then there is no effective process. When the agent knows in advance which policies will require an inspection the agent can make up the mileage on selective policies to, get the job done. The Auto Club will also reference the fact that conversations are recorded and can be audited for integrity. The agent knows this and never asks the insured what their mileage is. Theyll only make reference to how much the insureds commute is and make up a figure that is statistically consistent with the commute, albeit on the low end. The policy ends up being a fill in the blanks bonanza for the agent.
Some managers look the other way and others go further by processing business that has serious errors. In fact some managers were required to send policies through processing a second time to verify corrections were completed because the managers couldnt be trusted to verify the corrections were actually completed. This company needs managers to watch the managers. But when the processing team can only catch incorrect phone numbers or spelling corrections, the mileage factor cannot be corrected at the pre-completion level but only at renewal when the insured complains about the increase in premium unless an inspection is completed and a mileage disclosure is developed. Without seeming redundant, I have spoken in generalities because it is not my intention to get employees in trouble but to correct the failures of this program and this company. If the deficiencies discussed here are not corrected I have lists of managers, employees, and policy numbers that are at issue and I will release this information to the media and notify those insureds that have been wronged. Insureds will have grounds for a class action lawsuit.
Sincerely,
Ann Anonymous Agent (AAA)
For fear of retaliation
cc: Dave E. Jones; CA Insurance Commissioner, Robert T. Bouttier; COO Auto Club Enterprises, Avery R. Brown; General Counsel Auto Club Enterprises, Karen Featherstone; Underwriting Manager, David Lazarus; L.A. Times