Jaskaran Singh Gill, of Tukwila, Wash., was charged in King County Superior Court in Washington with two counts of first-degree theft, one count of second-degree theft and four counts of filing a false insurance claim after an investigation by Insurance Commissioner Mike Kreidler’s Criminal Investigations Unit.

Gill was arraigned on Nov. 5 and the judge set a hearing date for Dec. 16.

According to the investigation, Gill filed multiple fraudulent claims from June 2018 through April 2019 involving motorcycle collisions, medical injuries, property damage and lost wages with Allstate, State Farm and GEICO insurance companies totaling $65,922. Many of the claims had similar types of losses. Investigators reportedly found that Gill used duplicated and altered documentation to substantiate the claims.

The series of claims started in June 2018 with Allstate after Gill was involved in a collision with another motorcycle on State Route 7 in Pierce County. His claim included extensive damage to his Yamaha FZ-10 motorcycle, medical bills for injuries, and damage to his riding gear and helmet. All told, Allstate paid Gill $13,775 and declared the motorcycle a total loss. Gill kept the motorcycle.

In October 2018, Gill reportedly filed a claim with State Farm for a collision, again on State Route 7 in Pierce County. He reported that he was riding a 2017 BMW S1000 motorcycle and was the victim of a hit and run. In all, State Farm paid Gill $30,831 for the total loss of the motorcycle, damaged gear, medical bills, lost wages, uninsured motorist and pain and suffering.

In December 2018, Gill filed a claim with State Farm under a personal articles policy he bought the month before. He said his rental car was broken into while he was traveling in India and electronics and cameras were stolen. State Farm paid him $10,631 for the claim. After the claim, the company’s fraud unit started looking at Gill’s claims more closely and advised customer service to monitor any future claims from him.

In April 2019, Gill filed another hit-and-run injury claim, this time with GEICO Insurance. He said he was riding a 2017 BMW S1000 – the same motorcycle that State Farm had declared a total loss in December 2018 – in Grays Harbor County. The claim included $15,000 worth of damage to the motorcycle and lost wages from his job. GEICO investigated the claim and found similarities between the two previous hit-and-run claims, including identical photos and receipts. Gill withdrew the claim and declined to meet with or speak to GEICO’s investigator.

In the meantime, fraud investigators from the other insurance companies started looking at the previous claims and found suspicious claims and documentation, including:

Photos of the totaled Yamaha FZ-10 to substantiate claims involving his BMW S1000.
Created wage loss documents from Harborview Medical Center, where he said he was employed. Kreidler’s investigators confirmed that Gill was never employed there.
Duplicated and altered medical bills with dates that were changed to match various claim dates.
Duplicated and altered receipts for riding gear.
The insurers referred the case to Kreidler’s CIU, which investigates insurance fraud and works with the Washington State Patrol and state and local prosecutors on criminal cases.

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Older Model S sedans and Model X crossovers get a lot less coverage

The prospect of buying a used vehicle from Tesla just became a less appealing option. The electric car manufacturer quietly updated its website with new warranty terms for used Model S sedans and Model X crossovers, and the updates do not fall in the customer’s favor.

Just two days ago (thanks, Wayback Machine!), Tesla’s used vehicle warranty page said that used Models S and X that were under four years old and showed less than 50,000 miles on the odometer would get “a Used Vehicle Limited Warranty for 4 years or 50,000 miles, whichever comes first, starting from your delivery date.” If the Model S or X was between four and six years old or had between 50,000 and 100,000 miles, “a Used Vehicle Extended Limited Warranty provides coverage for up to 2 years post-delivery or up to 100,000 miles, whichever comes first.” In either case, ‘the balance of original Battery and Drive Unit Limited warranty still [applied] for used vehicles.’

Today, the same page shows something completely different:

Tesla used vehicles are covered by the remainder of 4 years or 50,000 miles left on the Basic Vehicle Limited Warranty. After expiration, the Used Vehicle Limited Warranty provides additional coverage of 1 year or 10,000 miles. If the Basic Vehicle Limited Warranty has already expired, the Used Vehicle Limited Warranty will provide coverage of 1 year or 10,000 miles, starting from your delivery date.

The change was first reported by Electrek, which points out that used S and X models from 2016 or earlier are now much less attractive to would-be buyers. That’s particularly true since Tesla’s vehicles aren’t exactly the pinnacle of reliability.

This news comes right after Tesla killed its seven-day return policy on new vehicles, and just days after the starting price of new Model S sedans was cut to $69,420.

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With customer needs changing rapidly, two giants in their respective worlds have formed a partnership that looks to take automotive and mobility insurance to the next level.

Swiss Re and Daimler Insurance Services have formed a 50/50 joint venture, known as Movinx. Located in Berlin, the firm has been set up as an insurance intermediary and service provider and has already received competition clearances.

“We believe that partnering with Daimler Insurance Services and establishing Movinx will take us to the next level in innovating mobility insurance,” said Swiss Re digital transformation officer Pravina Ladva. “Our joint long-term ambition is to unlock an ecosystem interplay where insurance supports the introduction of new technologies such as advanced driving assistance systems and autonomous cars as well as new business models in the mobility area.”

According to the firms, insurance needs to evolve alongside the expansion of automated driving and e-mobility. Movinx will act as a managing general agent (MGA) to make insurance part of the vehicle purchase – so that instead of short-term partnerships between car manufacturers and insurers, the focus is on a “joint development journey” that allows for the introduction of new insurance propositions across a range of markets.

“By joining forces with Swiss Re we can lead transformation in an evolving market environment and advance insurance business,” said Ingo Telschow, CEO of Daimler Insurance Services. “We will establish a new business model as well as co-create and co-own an insurance platform. This platform enables easy and efficient insurance purchase and customer-centric services by using real time data. Furthermore, we as Daimler Insurance Services are going deeper into the value chain of insurance business, having more influence on product development and pricing.”

The partners noted that further co-operations are possible in the future with other stakeholders

“Future partners will benefit from our co-owned insurance MGA and be able to offer white-labeled solutions globally,” they said in a release. “Instead of having to deal with many insurers, the manufacturer has one sparring partner, Movinx, across countries. Movinx will then partner with locally licensed insurers to deliver its solutions to the end-customers and cover insurance risk. Insurers and other stakeholders can connect to the IT platform and profit from centralized operations and automated processes supported by a combination of machine- and deep-learning technologies. By connecting to the MGA’s platform, insurers benefit from not having to build tailored and quickly changing insurance programmes.”

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Illinois motorists should beware of more deer activity this time of year, particularly at dawn and dusk.

Officials from the Illinois Departments of Natural Resources and Transportation note that it’s deer mating season, meaning more deer will be on the move, and crossing roads.

Transportation Secretary Omer Osman urges motorists to be watchful and remember the rule, “Don’t veer for deer.”

“While the urge to swerve is instinctual, it could cause you to lose control of your vehicle or drive into oncoming traffic, increasing the severity of a crash,” Osman said in a statement.

Officials say motorists should be aware of their surroundings, especially in areas marked with deer crossing signs. They should scan the roadside for “eye shine,” the reflection of headlights in the animals’ eyes.

And when a deer is spotted, slow down. They travel in groups, so more are likely nearby.

Illinois recorded more than 16,200 crashes involving deer last year. Of these, 15,600 resulted in damage to property or vehicles. Nearly 4% caused personal injuries and four were fatal.

More than 40% of crashes occurred in October, November and December, with the most being reported in November.

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California will ban the sale of new gasoline-powered passenger cars and trucks in 15 years, Gov. Gavin Newsom announced Wednesday, establishing a timeline in the nation’s most populous state that could force U.S. automakers to shift their zero-emission efforts into overdrive.

The plan won’t stop people from owning gas-powered cars or selling them on the used car market. But in 2035 it would end the sale of all new such vehicles in the state of nearly 40 million people that accounts for more than one out of every 10 new cars sold in the U.S.

California would be the first state with such a mandate while at least 15 other countries have already made similar commitments, including Germany, France and Norway.

Newsom used the hood of a red, electric-powered Ford Mustang Mach-E to sign an executive order directing state regulators to develop new regulations to meet the deadline. He urged Californians to “pull away from the gas pumps” and encouraged other states to join California for the good of the environment and public health.

“If you want to reduce asthma, if you want to mitigate the rise of sea level, if you want to mitigate a loss of ice sheets around the globe, then this is a policy for other states to follow,” Newsom said.

While environmental groups cheered the announcement, the oil industry panned it and the automakers’ industry group sought a middle ground, saying it’s committed to increasing zero-emission vehicles but through cooperation among governments and businesses, not by mandates.

Meantime, White House spokesman Judd Deere said flatly: “President Trump won’t stand for it.” And Larry Kudlow, Trump’s economic adviser, labeled it a “very extreme” position that he doesn’t think other states will follow.

Democratic presidential nominee Joe Biden’s campaign didn’t comment directly on Newsom’s plan. But spokesman Matt Hill said Biden believes electric vehicles can create “good-paying union jobs, dominate a fast-growing market worldwide, and meet the demands of the climate crisis.”

Tailpipe exhaust from cars, pickups, tractor-trailer rigs and other transportation are the single largest source of air pollution, and California has by far the most cars on the road than any other state.

In 2017, the federal government said California emitted 266.5 million tons of carbon dioxide from the burning of petroleum. That’s about the same as the total emissions from Egypt, which has 2.5 times the population.

Newsom says his order will reduce greenhouse gas emissions by 35%. But he stressed the benefits went beyond the environment, saying electric cars and trucks are “the next big global industry and California wants to dominate it.”

California is already home to 34 electric vehicle manufacturers – including Tesla, the world’s top-selling maker – and accounts for about half of all electric vehicle sales in the U.S.

Some auto industry analysts warned the timeline could be too fast for technology to catch up to customer’s expectations. Battery life and manufacturing costs are still issues that haven’t been resolved, said IHS Markit principal analyst Stephanie Brinley, who studies the North and South American auto markets.

On Tuesday, Tesla announced plans for cheaper batteries with higher energy density, but they are well into the future, she said.

“Even if you get a battery like Tesla is talking about, it’s going to take time and money to get there,” Brinley said.

Jessica Caldwell, executive director of insights at the Edmunds.com auto pricing site, said Newsom’s announcement “does seem like this is a significant shot fired against” the internal combustion engine that is likely to trigger high-level meetings at all the auto companies, which were moving toward electric vehicles but didn’t expect a zero-emissions mandate in 15 years.

Ford Motor Company said it agreed with Newsom that it’s time to take action to address climate change. But the Alliance for Automotive Innovation, which represents Ford and most other automakers, said markets can’t be built with mandates and bans.

The oil and gas industry, meanwhile, criticized Newsom for holding a news conference on Wednesday in front of nearly $200,000 worth of electric cars “as he told Californians that their reliable and affordable cars and trucks would soon be unwelcome in our state.”

“Big and bold ideas are only better if they are affordable for us all,” said Cathy Reheis-Boyd, president of the Western States Petroleum Association. “Our industry and the energy we provide will be the part of any solution.”

Mary Nichols, chairwoman of the California Air Resources board tasked with writing regulations for the plan, said electric vehicles will be more affordable in 15 years and everyone will benefit from cleaner air.

California already has some of the most progressive climate laws in the country, putting it at odds with the Trump administration and it’s more relaxed regulatory approach to environmental policy. The federal government has tried to end California’s authority to set emission standards for cars and trucks, a move the state is fighting in court.

About a dozen states follow California’s lead on auto emissions standards that are more restrictive than federal rules. If those states follow suit on zero-emission vehicles, it could have a huge impact on the U.S. automobile industry.

Governors from many of those states appeared with Newsom at an event on Wednesday sponsored by the U.S. Climate Alliance. They praised California’s move, but they gave no immediate indication they would join it.

“We’re going to be with you, the auto industry is going to be with you, as we move to zero emissions vehicles,” Connecticut Gov. Ned Lamont said.

Newsom’s order on Wednesday also targeted medium and heavy duty commercial trucks, saying he wants those to be 100% zero-emission vehicles by 2045 “where feasible.”

On the oil production side, Newsom called on the state Legislature to end new fracking licenses by 2024. Fracking is a technique that allows energy companies to extract huge volumes of oil and gas from shale rock deep underground. It involves injecting high-pressure mixtures of water, sand or gravel and chemicals into rock. Fracking opponents says the chemicals involved threaten water supplies and public health.

“Newsom can’t claim climate leadership while handing out permits to oil companies to drill and frack,” said Kassie Siegel, director of the Center for Biological Diversity’s Climate Law Institute. “He has the power to protect Californians from oil industry pollution, and he needs to use it, not pass the buck.”

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Ford is giving new car buyers a way to save money on insurance now that millions of Americans are working from home and driving less than they were before the coronavirus hit the U.S.

The automaker said Thursday it is partnering with start-up insurer Metromile to give drivers easier access to the company’s pay-per-mile insurance offering. When drivers sign up on Metromile’s app or website, the odometer on their new Ford will immediately connect to Metromile’s software, which will start tracking miles.

Car insurers have faced controversy in the six months since Covid-19 forced offices around the country to close and put an end to live events and group gatherings. Major insurers said in April that they would start providing refunds, credits or rate cuts to customers because of the plunge in drive time, but a number of class-action lawsuits have been filed by consumers who said they should have been given bigger discounts.

“Having a product that helps people save money in a time like this is really important,” said Metromile CEO Dan Preston. We “build products catered to specific individuals as opposed to insurance products built for classes of drivers.”

The announcement comes a day after Ford said it’s looking to slash at least 1,400 jobs, as it cuts staff in underperforming areas while investing in new technologies.

Founded in 2011, Metromile allows anyone to sign up for its product online, regardless of what kind of car they drive. Preston said the company targets the two-thirds of people who drive less than 12,000 miles per year, which he calls the break-even point. In other words, anyone who drives less than that should save money with Metromile versus traditional insurers.

Thursday’s announcement said eligible Ford owners can save $741 a year on average, based on a recent survey of Metromile customers.

Preston said Ford is the “most forward-looking” of the major manufacturers in baking the product into its cars, but he expects other partnerships to emerge. The company says the number of Teslas insured by the company has grown 191% in the last two years.

To date, Metromile has tracked the number of miles driven through a separate device that plugs into the car’s diagnostics port. The new embedded Metromile offering is available only on new Ford cars that have connected systems open to outside developers. That includes most Fords from the 2020 and 2021 model years, the companies said.

Metromile, based in San Francisco, is generating over $100 million in annual revenue, Preston said. Sales plunged in the early days of the coronavirus because driving went way down. However, in the subsequent months many people went back to work and chose to drive instead of taking public transportation. Metromile also attracted new customers who were driving less and looking for cheaper insurance than they were getting from Allstate, Geico and Progressive.

“A lot of changes are very likely not temporary,” Preston said.

Metromile has raised about $300 million in private capital, including from insurers Tokio Marine Holdings and Intact Financial, and venture firms NEA and Index Ventures. Insurance-technology companies are still trying to prove that they can employ software, algorithms and an upgraded user experiences to bring down costs for consumers while also generating a profit in a low-margin industry.

In July, insurance-tech company Lemonade, which offers insurance to renters and homeowners, held its stock market debut. The company has a $3 billion market cap. Revenue more than doubled in the second quarter to $29.2 million, but Lemonade still reported a net loss of $21 million.

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Online insurance marketplace Pretected has published a new report outlining that ever since the COVID-19 pandemic struck the US, there has been a surge in demand for online auto insurance quotes.

According to the insurance comparison website, there has been an average increase of 147% in online auto insurance quote requests between the periods of March-August 2019 and March-August 2020.

Pretected noted that this trend may sound counterintuitive at first; after all, driver activity dropped considerably during the pandemic, and some believed that drivers would be less bothered with their current coverage during this period.

“But it actually makes a lot of sense when we see the struggling economy as more and more people are looking for every possible way to save a couple of extra dollars,” Pretected commented.

The website also took note of which US states saw the biggest increases in auto insurance quote requests. California leads the pack with the highest increases in online requests for quotes, followed by Georgia, then New York. All three states also happen to be among the top states with the most COVID-19 cases in America, Pretected pointed out.

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Mercury General Corp. on Monday reported second-quarter earnings of $228.2 million.

The Los Angeles-based company said it had net income of $4.12 per share. Earnings, adjusted for investment gains, were $1.86 per share.

The auto insurance company posted revenue of $1.01 billion in the period. Its adjusted revenue was $847.4 million.

Mercury General shares have decreased 12% since the beginning of the year. The stock has fallen 24% in the last 12 months.

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Washington Insurance Commissioner Mike Kreidler reached out to insurance company CEOs in a letter and urged them to stand behind their recent pledges to end discrimination and racial inequities by supporting his proposal to ban the unfair practice of using credit scoring in setting prices for auto, homeowner’s, renter’s and life insurance.

“Many leaders in the insurance industry have recently pledged to eliminate inequity,” said Kreidler. “My proposal is an opportunity to convert these pledges into action. People will feel the economic impact of the coronavirus pandemic for years to come. It will be extremely hard for many people to improve their credit scores or even maintain their current score. They should not be penalized for circumstances that are no fault of their own.”

What we know about income and racial disparity in Washington, according to Kreidler:

Since March 2020, more than 1.2 million people in Washington filed for unemployment. That number is 89% higher than during the peak of the great recession from 2007-2009.
In 2018, 8% of whites in Washington lived in poverty, compared to 20% of Blacks and 17% of Hispanics.
Washington Insurance Commissioner Mike Kreidler
Washington Insurance Commissioner Mike Kreidler
Kreidler is asking the Legislature to amend two state laws that allow insurance companies to help determine rates for consumers in Washington. The companies can continue to use other factors to set premiums, including age, gender, claims history, driving record, where a person lives, marital status and more, he noted.

His proposal will be sponsored by Sen. Mona Das, D- Kent, and Rep. Steve Kirby, D-Tacoma.

“Insurers believe there is a correlation between someone’s credit score and the likelihood they’ll file a claim in the future,” said Kreidler. “They believe that if you are reckless with your credit, you’ll be reckless in managing your finances and maintaining your home. But many people see their credit scores drop when they lose their jobs or suffer from a serious illness. It’s more likely the correlation has less to do with risk and more to do with your income and what wealth you’ve accumulated.”

Kreidler has sought a ban on insurers’ use of credit scoring several times since 2001 and succeeded in limiting its use. Today, insurers cannot use credit history to deny coverage or cancel a policy. They are also prohibited from using certain credit factors, such as medical bankruptcy, to determine how much you pay.

“Credit scoring institutionalizes racism and holds down people with low incomes,” said Kreidler. “I believe the insurance industry leaders do not want to be on the wrong side of this issue. I think they’ll recognize that relying on such arbitrary data as credit scoring at a time our country is coming to terms with extreme economic hardship and its history of racial disparity does not enhance their corporate image.”

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Dealers ‘have an issue now, which is that we don’t have enough inventory’

NAPERVILLE, Ill. — At the height of the coronavirus pandemic in mid-April, used-car dealer Alex Tovstanovsky had vehicles jammed six rows deep on his lot in the western Chicago suburb of Naperville.

But the seeming oversupply was not a mistake.

Despite plummeting sales at his store, Prestige Motor Works, Tovstanovsky was betting on a recovery, buying dozens of cars in early April as auction prices for used vehicles dropped.

That bet is now paying off. Tovstanovsky can offer cars cheaper than local competitors, and his sales jumped 38% in May versus May 2019.

“This is an election year, and I felt the Trump administration and the Republicans in Congress would do whatever it took to keep the economy strong,” Tovstanovsky said.

Rising demand has now pushed used-vehicle prices about 20% higher than when Tovstanovsky made his bet.

“I just wish I’d bought more cars when prices were low,” Tovstanovsky said.

As America shut down in March to combat the spread of COVID-19 and its economy tanked, U.S. new-vehicle sales plummeted. Sales were down around 30% in May, an improvement from a 47% drop in April.

But used-vehicle sales have rebounded faster.

Dealers are now competing to buy vehicles, even as the U.S. economic outlook remains uncertain.

“We actually have an issue now, which is that we don’t have enough inventory,” said George Arison, co-CEO of online used-car seller Shift. Shift’s sales rebounded to pre-COVID-19 levels by late April.

Americans typically become more frugal and favor used cars in uncertain times. Cars remain a vital commodity in a country where getting to work without a vehicle is impossible in all but a few large cities.

Rising used-car sales increase competition for automakers who must sell new cars to offset cash burned during a two-month shutdown for the North American auto industry.

According to Cox Automotive, new-vehicle sales for the week ending May 28 were down 28%, but sales of used vehicles were up 6%.

According to Cox unit Manheim, wholesale used-vehicle prices rose 5.74% in the first half of May from the previous month.

Carmax Inc, the No. 1 used-car dealer, has already called back about two-thirds of the 15,5000 employees it furloughed in April.

“We expect to come out of this in a position to take advantage of the resiliency of the used-car industry,” said chief marketing officer Jim Lyski.

While dealers say access to financing is plentiful, Wells Fargo & Co said this week it will stop offering loans to most independent dealers due to economic uncertainty.

‘Melting ice cubes’
Used-car dealers say recent customers have ranged from deep subprime borrowers using their $1,200 federal pandemic relief checks for a downpayment, to prime borrowers with pristine credit who saved money working from home since March.

“I’ve seen a lot of downpayments this month of exactly $1,200,” said Scott Allen, owner of Auto Land in Fort Worth, Texas, which sells older used vehicles. After being closed for nearly a month from March 23, Allen’s sales in May were up 55% over his average for that month.

The U.S. used-vehicle market has distinct layers. At the top, in terms of price, are vehicles returned after short-term leases that look nearly new. Those are a concern for the industry.

More than 4 million off-lease vehicles are due to return to the market this year, at a rate of around 340,000 per month.

Automakers and their finance arms are trying to slow the pace at which those vehicles hit auctions to avoid flooding the market.

KAR Auction Services Inc has bought 200 acres (0.81 square kilometer) of land and is seeking another 100 acres to store cars for major customers.

Tom Kontos, chief economist at KAR, which alongside Manheim dominates the U.S. used-car auction market, calls these vehicles “melting ice cubes.” They lose value every day, and cannot be held back for long.

Franchise new-car dealers are driving demand for used cars to fill lots short of inventory because the coronavirus shut down assembly plants.

Ten of the top 15 models sold at U.S. franchise dealers were used rather than new between May 22 and May 28, according to automotive marketing platform PureCars.

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