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Group Auto Insurance

January 02, 1986

Hallett states that "Automobile insurance that is underwritten through employer groups, a marketing concept . . . only recently gained approval in California."

Hallett may have become aware of this only recently, but away back in 1967, CNA Insurance, through its Continental Casualty Co., was marketing employer-group auto insurance in California. The plan, called PSP (Personal Security Plan) offered lower rates than most competitors and had the additional feature of payroll deduction for payment of monthly premiums. Each prospective insured was rated on his her driving record, and only the most terrible driver was declined (but offered insurance elsewhere). The rates, however, were based in part on the area in which the car was garaged.

A number of large organizations in California signed up for this plan for their employees, including more than one governmental organization.

I was involved with PSP until 1969, and I do not know what ultimately happened to the plan. So far as I know, group auto insurance was also offered by CNA in other states, and may still be in operation.

Employer backing of the plan and the ease and convenience of small monthly payments of premiums, as well as underwriting by a major insurance carrier were of prime importance to the success of the program. Hallett is right in urging the insurance commissioner to encourage product improvement.

HASKELL COLLIER

Whittier

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