Causes for auto insurance rate increases
ROCHESTER, Minn. (KTTC) – Car insurance rates have been on the rise and it has become more visible in the post-COVID era.
Scott Holeman with the Insurance Information Institute says, although inflation certainly plays a big factor in increasing rates, this rise is also due to driver’s decisions behind the wheel.
“There are more accidents, and more accidents that are severe in nature and that cost more money. We are also seeing more fatalities and more injuries on roadways and that’s led to more litigation with the claims process. And the more lawsuits we see, the higher claims we see due to those higher costs.”
Holeman says this increase in accidents means insurance companies are more at a loss.
More crashes plus supply chain problems caused by the pandemic are two major reasons why spare part prices and repair costs have also gone up.
“We also know there are more cars on the road with very sophisticated technology. Those tech-savvy cars are designed to enhance our safety, but when they are in accidents, it’s higher to repair those cars, because technology is expensive.”
Holeman encourages everyone to call their insurance providers and see what adjustments can be made.
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