Policyholders facing higher insurance premiums due to inflation are choosing to drive less, change vehicle type or carrier – Repairer Driven News | CarTailz

A recent Insurance Trends report by Insurify examined how inflation has affected auto insurance premiums by reviewing more than 40 million of their consumer listings.

Insurify found that weather patterns, crime rates and population densities contribute to regional variations in auto insurance rates, according to the Insurance Information Institute, and state-level legislation does the same through different driver attributes that insurers use to set rates and minimum coverage drivers must carry. Other factors that can affect insurance premium costs include vehicle type, marital status, driver’s license, home ownership, age, gender, education, and creditworthiness.

According to Insurify, Michigan, Louisiana, and New York pay the highest premiums, while Hawaii, North Carolina, and Wyoming pay the lowest. They also found that urban drivers pay an average of 15% more for car insurance.

To curb the rising cost of auto insurance, more than 1,200 respondents to the Insurify survey said they are considering driving less (65%), buying an electric vehicle (EV) or a hybrid vehicle (30%), the insurance carrier to switch (30%) and move closer to public transport or walkable areas (16%) or forego insurance (10%).

CCC Intelligent Solutions vice president of consulting and services Bart Mazurek said during this year’s MSO Symposium in Las Vegas last week that traffic levels are returning to pre-pandemic levels, but fewer accidents are happening as traffic congestion eases mainly caused by teleworking.

Speaking of insurance, Insurify CEO Snejina Zacharia told Yahoo Finance, “As we saw the economy accelerate and demand recover from the pandemic, Americans’ overall cost of living, including insurance, increased in 2022 due to the increasing… pandemic-related disruptions and increased inflation.”

An August survey of 2,000 drivers by US News & World Report, conducted in part to find out how inflation and the COVID-19 pandemic have affected consumers, found that 49% were driving fewer and 61% drive less due to higher fuel consumption prices.

The AAA reported in September The average annual cost of owning and operating a new vehicle has increased to $10,728, or $894 per month, up $1,000 from 2021. Selling prices for used vehicles have skyrocketed in recent years, and the average age of vehicles on the road has also increased – all factors attributed to the pandemic and inflation. According to the AAA, gas prices are the most important factor driving this year’s average higher.

Due to the current economic climate, Insurify found in its findings that “it’s hard to predict which companies will increase their rates and when.”

“We encourage drivers to compare offers from at least four to five companies before deciding on a policy. With inflation rates so high this year, motorists can compare quotes about every six months to ensure their current policy and premium are best suited to their needs. Keep in mind that some insurers may offer lower rates
Bonuses for customers who have been with a company for more than a year.”

Finding discounts from truckers through the bundling of home and insurance policies and an AAA membership, for example, can also help reduce premiums with just one discount, potentially reducing annual auto insurance premiums by 15%, according to Insurify.

“A third of drivers do not use discounts, including 16% who do not use a discount even if they know they qualify for one or more,” said Insurify. “Finding a policy with one or more discounts can be an easy way for drivers to save on auto insurance.”

For more consumer savings tips, see the end of the outcome document, available here.

According to Betsy Stella, vice president of insurance partnerships at Insurify, the “current volatility” of the US insurance market is unlikely to stabilize until at least mid-2023. “Based on our extensive research and feedback from over 100 transport companies, the general consensus is that it will be eight to 12 months [from fall 2022] before the market stabilizes,” she said in a statement. “Some believe it could be several years before a soft market returns.”


Credit: Mohamad Faizal Bin Ramli/iStock

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