Driving is an important aspect of our daily lives. We use our cars to commute to work, run errands and travel to see friends and family. Outside of renting or buying a home, a car is one of the biggest purchases that people will make.
Car insurance is vital to protect you and your family in case of an accident. While required nearly everywhere in the United States, the auto insurance industry is grappling with changes in the market and adjusting its processes.
Here are three things you should know about car insurance that’s happening right now.
Rising costs
Like the economy, rising costs are also hitting the car insurance market. With less driving during the heights of the COVID-19 pandemic, insurance premiums were lower for consumers with fewer accidents and claims.
However, with people returning to the road for work and leisure, the rise in accidents has caused prices to surge. Included in this was also the lack of parts available due to a worldwide chip and manufacturing shortage that stalled car production and repairs.
As cars have become more expensive to repair or replace, insurance companies have reflected this in raising rates for customers in the type of policies they write.
Increases to continue in 2024
With those factors and more, the cost for auto insurance is expected to increase into 2024 and possibly beyond.
According to the American Property Casualty Insurance Association, premiums rose just six percent from 2018 to 2022, while claims for vehicle damage (50 percent) and bodily injury (40 percent)rose sharply.
These escalating factors are being felt by insurance companies who are paying out more in claims than they were nearly 10 years ago for repairs and medical expenses. As these trends continue, customers will see increases when it’s time to renew their insurance.
Keeping your options open to save money
It’s important to know that there are many ways for consumers to lower the cost of their auto insurance.
Bundling your home and auto insurance with a company that provides both is one way, while multi-car discounts are available through others as well. Raising your deductible, the amount you pay in case of an accident, can also lower your payments.
Having a clean driving record is always an advantage, and customers can use that information by seeing if their insurance company offers telematics. Telematics tracks your driving habits using an app or device, rewarding you for safe driving. This reward can be in the form of cash back or a discount on your insurance depending on the company and program.
At Westwood, our agents are always on top of the latest trends in the insurance industry. We work with some of the top auto insurance companies to give you the coverage you need. Give us a call or get a quote today.
Please Note: This article is for general informational and educational purposes only. It does not represent any specific insurance policy and does not modify any provisions, limitations, or exclusions of any current policy.
