Why is My Auto Rate Going Up?

Why is My Auto Rate Going Up?

There are several factors that impact our auto insurance premiums. Insurance is meant to indemnify us in the event of a loss. Insurance premiums paid are pooled together to help provide peace of mind in the event we were to be involved in an accident. This pool of money assists in paying for bodily injury, defense costs, and physical damage costs to repair vehicles or other property a vehicle might come into contact with.

While some of us have never had an accident or turned in a claim, our rates can be impacted by claims paid out for others. Rates are adjusted to insure that insurance companies remain solvent in order to continue to pay out on claims. Below are just some of the significant factors that contribute to premium increases:

Distracted drivers

Distracted driving results in an increase of accidents which increases the overall costs for insurance companies. This increase in accidents can compound with the rise of medical costs and vehicle repair costs.

Medical costs

The rising cost of medical care continues to play a role in the need to adjust auto insurance premiums for bodily injury (and possible lost wages) incurred in an accident.

Vehicle repair costs

With new technology comes increased costs to repair a minor fender bender. For example a newer vehicle with sensors costs more to repair than an older vehicle or a vehicle without these extra options installed.

 

So where does your state rank for auto insurance premiums?

IMT insurance writes in the 6 Midwest states of IA, NE, MN, IL, SD, and WI. Here is where these states rank from the least expensive to the most expensive states for annual auto insurance premiums:

  • Wisconsin # 50
  • Iowa # 48
  • South Dakota # 36
  • Nebraska # 31
  • Illinois at # 30
  • Minnesota # 28

The top 5 states with the highest annual auto insurance premiums are:

  1. Michigan with an average premium of $2,611
  2. Louisiana with an average premium of $2,298
  3. Florida with an average premium of $2,219
  4. Oklahoma with an average premium of $1,966
  5. DC with an average premium of $1,876

The top 5 states with the lowest annual auto insurance premiums are:

  1. Maine with an average premium of $845
  2. Wisconsin with an average premium of $951
  3. Idaho with an average premium of $1,040
  4. Iowa with an average premium of $1,047
  5. Virginia with an average premium of $1,63

 

These annual average premium rankings are as of April 16, 2019 and can be found at the following website (https://www.insure.com/car-insurance/car-insurance-rates.html ).

 

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