Pandemic or not, expect higher auto insurance rates this year

In 2020, when the coronavirus was still new and business closures and work / home learning mandates suddenly became the norm, auto insurance companies handed out discounts and special discounts to reflect the fact that Americans were driving far fewer miles than before the pandemic. time.

But just as many returned to the classroom and the workplace, albeit with precautions, the Omicron variant of the virus began to wreak havoc, with confirmed cases skyrocketing.

And while this may keep Americans safe at home again for another period to help keep the virus in check, don’t expect to see a next round of auto insurance discounts unless the country does. goes through a full lockdown.

Rather, the country will see rates rise on average by about 0.6% in 2022, with those in 22 states experiencing increases of one percent or more; the largest increases are in Nebraska (+ 4.4%) and Minnesota (2.5%). On the bright side, rates are down, but only slightly, in 14 other states. In comparison, the average cost of an auto insurance policy fell 1.7% in 2021.

That’s according to the annual report on the state of auto insurance conducted by Quadrant Information Services for the consumer credit website ValuePenguin.com. The results are based on an analysis of 15 million auto insurance quotes for different drivers across 35,000 zip codes and 72 providers.

The site determined that the average cost of a full coverage policy among US drivers now costs $ 1,935 per year, with Michigan residents posting the highest rates in the country at $ 7,161. The cheapest rates in the country are in Maine, where the typical driver pays $ 1,051 per year for full coverage. This is a low to high difference of $ 5,226, which over five years could well exceed the value of an insured vehicle.

Why such a distribution? In addition to a motorist’s driving record and personal factors such as gender, age and marital status, auto insurance rates are based on a person’s address. Generally, those who live in the suburbs and rural areas will pay less than motorists in large urban areas where there is a greater likelihood of entering a wreck and / or seeing a damaged or stolen car.

Beyond that, rates can vary widely from state to state due to a number of variables including accident / claims / crime rates, number of uninsured drivers, frequency of inclement weather, population density, number of insurance companies doing business in a given state, minimum amounts of coverage required, and insurance industry regulations.

Below are the 10 states with the highest and lowest average auto insurance rate increases for 2022.

But before you pack your bags and move to a state with cheaper premiums, be aware that if your personal driving record is tainted with movement violations and at-fault accidents, it may not be worth the cost. The ValuePenguin report found that people with even a single traffic ticket or accident to their name will pay on average 55% more this year than someone with a blank history.

Those who reside in Texas and receive a drunk driving or speeding violation, or cause an accident will see their auto insurance premiums increase by 142% on average this year, followed by North Carolina (127%), California (107%) and Hawaii (107%). The national average rate hike in this regard is $ 3,683 per year for a DUI (a 90% increase), $ 2,882 for a at-fault accident and $ 2,403 for a speeding ticket. Obviously, it is worth being careful.

Of course, no matter what state you reside in, experts advise that you regularly shop around competing carriers to see which one offers the lowest rates and fine-tune your coverage accordingly. ValuePenguin says that getting full coverage will cost on average 147% more than a state-imposed minimum liability policy.

Getting quotes is especially important if any of your personal factors have recently changed. This includes buying a new car, adding a second or third vehicle to your policy, adding or removing a driver from your coverage, getting married or divorced, moving to a new home. new address or buying a house. And you should definitely shop around if you’ve been in an accident or been the subject of a moving violation, as some providers are more willing to accept the added risk at a lower cost than others.

You will need to be careful in the future to keep your auto insurance premiums affordable, no matter where you live, what you drive, or what your driving record looks like. Auto insurance premiums will continue to rise until 2023 as Americans return to their pre-pandemic patterns, according to ValuePenguin. An increase in the number of cars on the road can be expected to cause more accidents, more claims and, in turn, higher premiums. The continued increase in distracted driving, costly repairs to high-tech systems, and persistent supply chain shortages are expected to further contribute to the premium increase.

Here are the states where motorists will see the highest average increases in their auto insurance premiums in 2022:

  1. Texas: 142%
  2. North Carolina: 127%
  3. California: 107%
  4. Hawaii: 107%
  5. Michigan: 82%
  6. Georgia: 63%
  7. Kentucky: 61%
  8. Minnesota: 59%
  9. Connecticut: 57%
  10. Indiana: 56%

And here are the states in which drivers will experience the lowest auto insurance premium increases this year:

  1. Alaska: 41%
  2. Ohio: 41%
  3. Oklahoma: 40%
  4. South Dakota: 40%
  5. Florida: 39%
  6. North Dakota: 39%
  7. Missouri: 3 9%
  8. Pennsylvania: 37%
  9. Kansas: 37%
  10. Nebraska: 35%

You can read the full report here.


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Justin D. O'Neill