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Higher Auto Insurance Rates in 2020 PowerPoint Presentation
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Higher Auto Insurance Rates in 2020

Higher Auto Insurance Rates in 2020

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Higher Auto Insurance Rates in 2020

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  1. Personal Injury Law Firm: 540-345-2000 Request a FREE Consultation Higher Auto Insurance Rates in 2020 It seems that we should expect higher auto insurance rates in 2020, according to sources throughout the industry. Several factors are driving auto insurance higher at this time. Some of these factors are obvious and should not surprise us. But there are a few that we might not expect. Factors Driving Auto Insurance Rates Higher Several factors have been identified by insurance companies, others by industry observers, and still others by insured drivers. The factors most commonly cited are these:

  2. 1. Driving more miles. When gas prices dip, as they have done recently, most people can afford to travel more. Some people – particularly families – will take the trip they have been postponing for months or years due to cost. In addition, driving more typically leads to more accidents, which result in more insurance claims. 2. Insurance Companies are losing money. Despite recent increases in insurance rates and a decreasing number of auto accidents, insurance companies are not turning an underwriting profit. Keep in mind that insurance companies cannot implement a significant rate increase overnight. In most states, rate increases require review by the state department of insurance before becoming effective. Insurance has been paying large settlements on unexpected loss and repair claims. That insurance companies are losing money is dependent to some extent upon other factors (below). 3. Damage incurred as a result of natural disasters. An unprecedented number of natural disasters have devastated parts of the country during the last few years. The insurance claims for those damages have been significant. For example, the California Department of Insurance estimates that the November 2018 wildfires caused more than $123 million in auto and nonresidential claims. Hurricane Michael and Hurricane Florence hit the Southeast in the fall of 2018. These storms caused between $7.7 billion and $14.6 billion in insurance losses. It is easy to forget that cars are damaged in storms and destroyed in wildfires. Many of us do not know that this kind of vehicle damage is covered by the comprehensive insurance on your car. These damages bring larger losses for auto insurance companies. 4. More accidents due to distracted driving. The number of distracted driving accidents continues to increase year after year. Many of these accidents occur because people are using their phones while driving. The National Highway Traffic Safety Administration (NHTSA) reported that 2.443 million people were injured by distracted drivers in 2015. A State Farm survey found that nearly one-third of drivers access the internet while driving; 10 percent record video while driving. The largest portion of distracted drivers involved in fatal crashes is between the ages of 15 and 19. 5. Drugged driving accidents are increasing as states legalize recreational marijuana. The effects of marijuana upon the human nervous system are well documented. Also well documented is the fact that frequent users of marijuana experience lasting effects of the use of the drug for days, weeks, and months. 6. Higher Repair Costs. New cars are equipped with a vast number of safety devices. They range from backup cameras to sensors to lane- departure warnings, to assisted parking, and the technology that coordinates these devices to communicate with us and make us safer drivers. Automakers are also using stronger materials, also to make us safer. But all of this assistive technology that we believe will reduce the number of accidents comes at a high price. Replacing a damaged bumper now includes the replacement of sensors and cameras and more. Thus far, most insurance companies believe the jury is still out on the effectiveness of the technology to protect us and prevent accidents. In the last 15 years, the cost of bodywork on a vehicle has increased by approximately 40 percent more than overall inflation. The size of collision claims increased by 8.2 percent from 2014 to 2016.

  3. Insurance Agents Have Answers If your auto insurance price rises, there may be steps you can take to offset some of the price increase. There are, of course, a number of discounts that may be available to you. Taking a course to improve your driving skills may earn a discount. Decreasing coverage on old vehicles may save money. Increasing your deductible might reduce your monthly premium. Your insurance agent has the answers you need to make adjustments to your coverage. They have the statistics on claims and the cost of repairs. They can help you understand the sweet spot between paying more in premiums and losing more in the event of an accident. This might be a good reason to sit down with your agent and discuss your coverage needs, costs, and ways to find savings. The more you know about repair costs, accident damage statistics, and the extent of your coverage, the better the decisions you will make about your policy and its cost. Contact Altizer Law, P.C. If you or a loved one has been injured in an auto accident through no fault of your own, you may be entitled to financial compensation for your hurts and harms. Before accepting any offer from an insurance company, we urge you to speak with an experienced auto accident attorney. Bettina Altizer and her expert team have been helping people injured by the negligence or wrongdoing of others for more than 30 years. They understand that recovery from injury takes time and resources. They know that legal action is about the money.