NerdWallet: Car insurance rates are rising, and fear of future increases spurs more Americans to shop around

by | Aug 3, 2023 | Stock Market

This article is reprinted by permission from NerdWallet.  U.S. auto insurance owners say they feel the pinch of rising prices, and a higher percentage plan to switch insurance providers. While just 6% say they switched in the last 12 months to save money, double that proportion (12%) say they plan to switch in the next 12 months, according to a new survey from NerdWallet.

Around half of auto insurance owners (57%) say their insurance rates rose in the last 12 months. Over the same time frame, 12% of insurance owners (defined as those who own insurance apart from health insurance) say they put off a major purchase due to the cost of their insurance. The survey of more than 2,000 U.S. adults conducted by The Harris Poll found that Americans are feeling the effects of higher car insurance rates, but they haven’t yet switched in large numbers to try to save money. Plus: Why are gas prices going up again? Brace for further increases, analysts sayRates on the rise The average cost of full coverage car insurance is $2,148 per year, nationally, according to NerdWallet’s analysis of rates from pricing analytics company Quadrant Information Services. Full coverage insurance includes liability insurance (for the damage you may cause to other people or their property) and coverage for damage to your car. And costs for drivers are climbing. Auto insurance rates jumped 16.9% over the 12 months ending June 2023, according to the Bureau of Labor Statistics. NerdWallet’s survey found that 31% of Americans with auto insurance expect their rates to rise in the next 12 months due to factors outside their control. While auto insurance rates depend on factors like an individual’s driving history, age, location and car model, they’re also affected by insurance company costs and losses. For instance, the North Carolina Rate Bureau, a group that represents insurance providers in the state, filed a request for a 28.4% increase in auto insurance rates across the state in 2023. If the rate hike passes muster with state regulators, drivers in North Carolina will be subject to increases no matter their individual driving records. It’s no surprise that fewer than half of auto insurance owners (45%) think their auto insurance rate is fair. Also see: Used-car loans are sinking deeper underwater, study findsSwitching is still relatively uncommon While Americans aren’t universally in love with their insurance rates, …

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