Car insurance rates are surging as Americans struggle to pay for basic necessities and ongoing debt.
The newest Consumer Price Index shows car insurance spiked 20 percent year over year. The surge in pricing occurred after years of gradual price inflation, with earlier reports finding the rates grew by 36 percent since 2020.
That’s at the same time debt is soaring for many Americans. While Americans hold around 1.75 trillion in student debt loans alone, they also have $1.05 trillion in credit card balances not paid off.
Could be related. Low credit scores can lead to higher insurance prices. But that doesn’t seem right because the actual risk shouldn’t have likely changed. Could be higher repair costs. Of course simple corporate greed could be to blame. Didn’t need to actually say that one did I?
My car insurance went up $1200 this year, which blows my mind. No reason given.
Geico gave me a reason, “The reason why we are increasing your rate is because there are more people in your area who drive without insurance”
I’m sorry, but how the fuck is that my problem? Also, isn’t that the whole fucking point of the full cover insurance I am required to pay while I’m making payments on the car?
I’m sorry, but how the fuck is that my problem? Also, isn’t that the whole fucking point of the full cover insurance I am required to pay while I’m making payments on the car?
Insurance always wins. If you have full coverage they have to pay when you get hit by them. They don’t want to pay.
The article lists several factors:
Because car prices in general have skyrocketed, more Americans are keeping their current cars for longer. This means costly repairs can become more likely, and the car insurers have adjusted their rates accordingly.
In the last year, car repair prices also climbed 7 percent, outpacing inflation by more than double.
A supply chain slowdown and ongoing labor shortages have also pushed the insurance industry to implement price hikes on customers, insuranceQuotes.com analyst Michael Giusti said.
“None of that even mentions the higher medical costs they have to pay after accidents,” Giusti said. “Today’s higher premiums are just a reflection of those higher costs.”
The sudden rise of electric vehicle purchases also carried some of the blame, since EVs are more expensive to purchase and repair, Henn said.
Because car prices in general have skyrocketed, more Americans are keeping their current cars for longer. This means costly repairs can become more likely, and the car insurers have adjusted their rates accordingly.
This makes zero sense as insurance doesn’t cover vehicle maintenance/repairs.
I don’t understand how more costly repairs translate to higher insurance premiums. The insurance companies aren’t paying to replace your engine.
Also their $2500 average yearly premium is insane. I’m in my 30s with two cars and two drivers insured, including comprehensive and the highest coverage progressive offers, and a 100 mile round trip commute, and it’s only $1400 a year.
Your insurance might not be paying for your engine, but if you hit someone else, the liability policy will cover the car you hit engine
My car insurance went up $1200 this year, which blows my mind. No reason given.
Damn, what the hell. I pay about 15% of that for comprehensive coverage here in Germany. I guess that evens it out with the cheap fuel that you guys have.
I live in a no-fault state, which I love, but our insurance rates here are among the highest in the nation.
No fault insurance just means my insurance pays me, not whomever I get into an accident with. I do business with a company I trust to take care of me, so I don’t have to care if I’m in an accident with someone with shit insurance.
Not everyone here is a fan due to high prices, but I like it. I’ve seen too many friends in other states get low-ball offers that they either had to accept or be without a car for weeks while they appeal.
Ironically, it wouldn’t matter because the only accidents I’ve been involved in were with deer (who are notorious for carrying no insurance) so I’ve never been in an accident where no fault actually helped me.
I live in a no-fault state, which I love, but our insurance rates here are among the highest in the nation.
My experience living in a “no-fault” state was that someone rear-ended my wife who was stopped at a red light but insurance wouldn’t do jack because it was a “no-fault” accident. We paid higher for liability there than anywhere else we lived. Not a fan.
