Young motorists are more at risk to be hurt or killed in car crashes when they drive in states with looser enforcement of seat belt laws, according to a recent study from the Children’s Hospital of Philadelphia (CHOP) and insurance carrier State Farm.

Findings from the study, which surveyed 3,126 high school students from across the U.S., quantified differences between the impact of primary and secondary enforcement seat belt laws.

Under primary enforcement, police officers can stop a vehicle and issue a citation for not wearing a seat belt simply because they suspect the driver isn’t using one. Secondary enforcement only allows the officer to do so if the citation is issued in addition to another violation.

Primary Seat Belt Enforcement Encourages Use

Researchers found that a large majority of teenage drivers surveyed, 82 percent, reported regularly using a seat belt behind the wheel while 69 percent said they used them as passengers.

But researchers also found that drivers in states with primary enforcement were 12 percent more likely to use seat belts than those in states with secondary enforcement. Similarly, passengers in primary enforcement states were 15 percent more likely to buckle up as passengers, according to the study.

Researchers also said their findings showed that primary enforcement helps “narrow safety disparity gaps” by increasing seat belt use among specific teen groups with low use rates, including those living in rural areas, students in lower socioeconomic districts and pickup truck drivers.

A 2010 study from the National Highway Traffic Safety Administration (NHTSA) into strategies of increasing seat belt use identified similar trends. In the findings, researchers grouped states in “top 10,” “middle 31” and “bottom 10” in seat belt use and concluded that: nine of the “top 10” states enforced primary seat belt laws; 15 of 31 states in the middle group had primary enforcement laws; and three of 10 in the bottom grouping had enacted such a law.

Graduated Driver Licensing Key in Cutting Fatality Rates

The study not only suggested that primary enforcement be implemented in more areas but also said it should be integrated into the graduated driver’s license (GDL) laws used in most states. GDL restricts driving privileges of first-time motorists, gradually giving them rights like driving late at night or with passengers as they become more experienced.

CHOP researchers identified a clear drop in belt use in secondary enforcement states as teenagers advanced through GDL programs and gradually moved away from wearing their seat belts.

According to the study, research showing that seat-belted passengers and drivers are killed less often in crashes is irrefutable. Study authors cited NHTSA statistics that show use of seat belts cuts the fatality risk to front seat passengers by 45 percent. Conversely, more than half of young drivers involved in fatal crashes, 56 percent, were not wearing a seat belt.

As such, there is an obligation to push every route of enforcing seat belt use, according to researchers.

“Until all states have a strong primary enforcement belt law, researchers say the burden falls on parents to enforce the buckle up message, as well as on teen drivers to insist their friends use seat belts on every trip,” CHOP researchers stated in a press release.

Adding to the already wide breadth of research into teenagers’ dangerous habits on the road, the latest findings from CHOP and State Farm confirms the view of young drivers that insurance companies often take. Parents know that cheap insurance for young drivers is not widely available. Such insurance policies are scarce because research commonly associates teenagers with riskier roadway behaviors and worse driving outcomes, and most insurance companies respond with higher rates and insurance premiums.

Another study conducted by CHOP researchers and released earlier this month showed that, while the number of teen-involved fatal crashes has dropped, there is an increasing presence of crash-related head injuries. That study also recommended using GDL to combat the problem after concluding that the 12 states that have more comprehensive GDL and evidence-based programs saw a 50 percent reduction over six years in rates of teen fatalities in crashes.

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Michigan’s no-fault insurance system has seen yearly increases in losses that amounted to a growth of 192 percent in total losses over nearly the past decade, according to a recent study from the Insurance Research Council (IRC) that identified a small subset of the priciest catastrophic claims as the chief cost drivers.

The study highlighted a no-fault provision existing only in Michigan that allows policyholders lifetime compensation for collision-related injuries. That provision, combined with a 4 percent yearly average inflation rate for medical care, led to an average spike of 13 percent per year in total losses for the state’s insurance system between 2002 and 2011, according to researchers.

An analysis of 640 claims closed in 2011 found that cases involving losses greater than $250,000 represented just 1 percent of closed claims but 22 percent of total paid claims losses.

“This report provides further evidence of the role that a relatively small number of very large claims play in the increased costs to the entire Michigan no-fault system,” Elizabeth Sprinkel, senior vice president of the IRC, said in a statement.

Medical expenses from catastrophic claims still make up a significant chunk of the cost of those claims at 83 percent for closed and 90 percent for open claims. Not only have those shares risen over the years, but also researchers found that pricey medical procedures and hospital stays are becoming more common in claims.

The claims analysis showed that the number of claimants undergoing an MRI, which cost an average of $4,450, doubled from 8 percent in 2002 to 16 percent in 2011. At the same time, the number requesting a CT scan, which cost an average of $2,720, increased from 16 percent to 25 percent.

Of those closed claims, researchers also found that 76 percent of claimants received some kind of hospital treatment compared with a nationwide average rate of 61 percent.

Also, claimants made heavy use of a feature unique to Michigan’s no-fault system that allows family members to serve as caregivers. Of all open catastrophic claims with accident dates of 2004 or later, almost 60 percent included expenses for “family-provided attendant care.”

The study was published as debates about reform swirl around the state’s no-fault system. Industry groups decried Gov. Rick Snyder’s official repeal last week of state law requiring that all motorcyclists wear helmets, saying they were upset at statements Snyder made indicating he would only approach the repeal as a framework for broader reform.

Those groups, which included the American Automobile Association of Michigan, also said rising costs of the state’s no-fault setup is narrowing access to cheap rates for motorists seeking online auto insurance quotes or quotes directly from an agent.

AAA of Michigan issued a statement that it was “extremely disappointed” at the strong possibility of the no-fault system being further burdened by injury-related costs of helmetless motorcyclists and the complications that would have on discussions of reform.

Proposals to abolish the no-fault insurance system’s lifetime coverage and allow policyholders options of up to $500,000, $1 million or $5 million in coverage have stalled in the state Legislature.

Idaho and West Virginia last week joined the majority of states that prohibit any driver from texting while driving after governors there signed off on statewide bans on the practice.

Govs. C.L. “Butch” Otter of Idaho and Earl Ray Tomblin of West Virginia approved the laws, both of which go into effect July 1. There are currently 37 states that ban all drivers from texting behind the wheel, according to the Insurance Institute for Highway Safety.

Fines, Penalties for Violators

The West Virginia law’s texting restriction, which began as SB 211, will be considered a primary offense, allowing law enforcement officers who suspect a motorist is texting behind the wheel to make a traffic stop.

Also beginning in July, talking on a handheld device will be considered a secondary offense, meaning police can only issue a ticket in addition to a separate violation, but it will become a primary offense in July 2013.

The law also institutes a $100 fine for first-time violators that ramps up with more offenses. A third violation brings a $300 fine and will be recorded as three points against the offender’s license.

Idaho’s law, SB 1274, will institute an $85 fine for offenders who text while driving and categorizes the violation as a primary offense.

Insurance Implications for Violations of Cell Phone Bans

Idaho’s legislation specifically states that texting while driving will not be classified as a moving violation that insurance companies can use as cause to raise premiums.

In West Virginia, however, third and subsequent violations of this ban will each add three points to the offender’s driving record, a development which can lead to increased premiums, depending on the insurance company and its pricing methods.

That’s a fact that parents of young drivers might want to keep in mind, since the price of car insurance for teenagers is already high.

Teenagers have been a focus of both pieces of legislation because of their proclivity for using phones behind the wheel.

In Idaho, debate in the state Legislature included testimony from the Sauers, a family who lost a teenage daughter in a crash in January that authorities say involved distracted driving. The Sauers’ 18-year-old daughter had been texting and communicating on Facebook shortly before her death on the roadway, authorities say.

Insurance companies reported a record number of questionable claims to the National Insurance Crime Bureau (NICB) last year, with the annual volume of referrals surpassing the 100,000 mark for the first time in the NICB’s history, according to a report released Tuesday.

The NICB regularly works with insurers and police to investigate claims referred to it by the 1,000 property/casualty insurers that fund the not-for-profit organization.

Last year, that meant taking a look at 100,450 claims, which represents a 9.4 increase in referral volumes from the year before and a 19 percent increase since 2009, when just over 84,400 claims were reported as questionable.

Most of the referrals–about 78,000–fell under the “miscellaneous” category in 2011.

Vehicle claims was the third-largest category, accounting for over 35 percent of the more than 100,400 referrals lodged.

Referrals for vehicle claims increased 7.5 percent between 2009 and 2011, with there being a total of about 35,650 last year.

The most common referral related to vehicles was questionable theft, with 11,451. That accounted for nearly a third of all vehicle referrals.

The next largest referral reason was faked damage, which was less than half the volume of theft referrals but was still substantial, coming in at 4,998 last year. That’s a 23 percent increase from the year before.

Another category that has seen increases in virtually every subcategory is casualty referrals, which has seen a 2009-2011 surge of 37 percent.

Among the subcategories that have seen the biggest spikes in claims referrals are excessive treatment, faked or exaggerated injuries and billing for services that were never provided.

All of those problems have been major targets of recent Florida and New York auto insurance reform efforts.

One major improvement reflected in the new NICB data was a 63 percent decline in the number of auto glass insurance fraud referrals over the last two years. The annual volume dropped from 2,182 down to 817 during that period, although the numbers still aren’t back down to 2009 levels. That year, there were only 397 auto glass referrals.

“We are encouraged by the trend in auto glass questionable claims,” said Joe Wehrle, president and chief executive officer of the NICB, in a statement. “Our efforts to publicize this problem and to make insurers, law enforcement and the American public more aware of the potential fraud in the auto glass repair arena is hopefully having an impact.

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A new report released this week by the Consumer Federation of America (CFA) says that premiums have become an undue economic burden on low- and moderate-income (LMI) Americans and that state regulators should do all they can to reduce costs for this group.

“What is undeniable is that high auto insurance costs for LMI households either impose a substantial financial burden or greatly limit economic opportunity, especially access to jobs,” said the report’s authors, who are a former Texas regulator and the executive director of insurance at the CFA.

The CFA report makes three major recommendations to help right the situation: move to slice state-mandated minimum liability limits, create special programs for low-income Americans to get cheaper coverage and eliminate elements of the pricing process that hurt LMI households.

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Florida lawmakers kicked off the new legislative session by introducing a flurry of bills aimed at reining in the dishonest claims and billing they say are running the state’s no-fault auto insurance system into the ground.

The four pieces of legislation introduced this week—two in the state House and two in the Senate—call for similar actions, including increasing the prominence given to law enforcement reports about injury accidents, allowing insurers to offer preferred-provider discounts and giving priority to hospitals over other medical providers in the treatment of crash victims.

Florida is one of a dozen states nationwide with no-fault systems that were implemented in order to cut down on the number of accident-related injury lawsuits and to make the claims process smoother for policyholders.

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Massachusetts Gov. Deval Patrick has signed into law a bill barring auto insurance companies from considering consumer credit histories when setting premiums, superseding an existing administrative ban on so-called “insurance scoring.”

The new legislation caps months of maneuvering by the Massachusetts Association of Insurance Agents (MAIA), which has claimed administrative prohibitions on the practice did not go far enough. MAIA last month withdrew a ballot initiative seeking the ban in favor of a bill, revised at the request of state legislative leaders, that dropped statutory restrictions on insurers’ use of policyholders’ work and education histories when setting rates.

“Given the economic conditions, not only in Massachusetts but around the country, I think it was a victory for consumers,” MAIA spokesman Dan Foley said of the new law in a telephone interview. “We think it’s simply bad public policy to allow … companies to rely on (credit history) information when it has nothing to do with a person’s ability to drive.”

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West Virginia auto insurance companies saw their underlying costs slashed by about $200 million in the five years after the state passed legislation preventing some injured parties from suing after a vehicle accident, according to a new report from the Insurance Research Council (IRC).

The Third-Party Bad Faith Act, which took effect in 2005, eliminated the right of third parties to file lawsuits against another person’s insurer when the claimant felt the insurer had failed to fairly settle their claim.

Instead, the legislation replaced the litigation route with an administrative process by which claimants could file complaints with the state insurance commissioner, who was authorized to investigate and impose fines and penalties on insurers found to have violated state business laws.

The insurance commissioner was given authority to award economic damages and up to $10,000 in other damages to third parties, in part from a trust fund established by increased insurer examination fees, according to the Independent Insurance Agents of West Virginia.

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More than 40 percent of motorists in Oregon’s largest city think fines for texting while driving should be higher and nearly one-third believe the penalties should almost double, according to a new survey that also shows high percentages of drivers commit the offense.

According to the results of the poll, released this week by PEMCO Insurance, 31 percent of Portland-area drivers admitted to violating state law by talking on a hand-held cell phone while driving, and 26 percent confessed to texting or emailing from the driver’s seat.

But 42 percent of respondents said sending or receiving text messages behind the wheel should result in more than the $142 fine violators face under current state law. Thirty-two percent believe the fine should be at least $250, and 15 percent thought $500 or more would be appropriate.

And 55 percent stated that all violations for texting or talking on handhelds should be noted on a driver’s record.

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Two more auto insurers have joined the growing ranks of companies declaring deep losses in recent months, with Infinity Property and Casualty announcing an 80 percent drop in profits and The Hartford reportedly breaking even during the third quarter of 2011.

Infinity officials said net earnings for July through September fell to $6.1 million, down from $30.8 million for the same period last year. Income for the year’s first nine months dipped 60.6 percent, from $62.7 million in 2010 to $24.7 million this year.

The company—which provides cheap car insurance for many policyholders with blemishes on their driving records—blamed the poor results on the increased severity  of personal injury protection (PIP) coverage claims in Florida and bodily injury coverage in California. Losses and loss adjustment expense reserves related to accidents in prior years led to a $4.8 million in pretax decline, compared with $16.8 million in pretax increase for the three-month period in 2010.

The losses came despite gains in some areas, including an 11.2 percent increase in gross written premiums, which rose from $243.8 million for the three months leading up to September 2010 to $271.1 million over the same time frame this year.

Infinity’s combined ratio—a measure of profitability that compares performance of multiple companies—was 99.3, down from 88.4 last year.

Stagnant Cash Flow for The Hartford

The Hartford reported zero net income for the third quarter, blaming capital markets volatility and large catastrophe claims for the 100 percent drop from last year, when the company reported $666 million in third-quarter profits.

Core earnings were down 96 percent between years for the three-month period, from $705 million to $33 million.

The Hartford was hit with $134 million in catastrophe losses from July through September, officials said.

Infinity and The Hartford join the long list of auto insurers—including Allstate Insurance, State Farm, Progressive and MetLife Auto & Home— to announce steep third-quarter losses, many of them resulting from Hurricane Irene and other weather-related catastrophes.

Insurance industry experts typically define catastrophes as events that cause $25 million or more in insured property losses and affect a large number of policyholders and coverage providers.

Allstate announced earlier this week that its third-quarter profits tumbled 55 percent, thanks in large part to catastrophe losses of $697 million, a 179 percent increase from the previous year.

Progressive reported a 42 percent dip in net income for the quarter.

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