Who saves when some households are forced to economize on driving?
Families driving less when gas prices rise, or responding to economic reverses by doing less driving for shopping or entertainment, all result in less cost and windfall profits for car insurers. The cents-per-mile measure of insurance cost explains why the number of insurance claims historically decreases when unemployment or gas prices rise. Some companies spread their cost savings as dividend refunds of a uniform percent (5% to 20%) of the rates to all policyholders, whether or not they have individually been driving less.
