“Auto Insurance Inflation: Why Your Premiums Are Increasing”

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Despite Lower Inflation in Much of the Economy, Auto Insurance Inflation Is on the March

Auto insurance premiums have been on the rise, even as inflation in other sectors has slowed. According to the Bureau of Labor Statistics (BLS), auto insurance premiums increased by 17% over the past year, outpacing the rise in car prices. Despite this, many drivers are not switching insurers or even looking for better deals. An Experian survey conducted in July 2023 found that 78% of drivers stuck with their existing insurance carrier, and 59% haven’t explored potential savings from other insurers.

Claims, Pain and Automobiles

Experian surveyed 1,045 Americans with auto insurance in their name to understand how they are managing premiums in an inflationary environment. The survey revealed that households with incomes over $150,000 were more likely to report an increase in their auto insurance premiums, with 64% experiencing a hike. In contrast, 47% of households with incomes under $100,000 reported an increase. This disparity may be due to the higher cost of insuring electric vehicles, which are more popular among higher-income households.

Survey Insights

Nearly 20% of surveyed drivers made at least one claim in the past year. Most claimants were satisfied with the claims process and the settlement they received, with close to three-quarters reporting a positive experience. However, 8% were not satisfied with either the claims process or the settlement. Most claims were settled within three weeks, regardless of satisfaction levels.

A Switch in Time

While comparison shopping for auto insurance may not always result in savings, it’s the only way to find out. With inflation decreasing for most goods and services, the continued rise in auto insurance premiums will likely draw more scrutiny from consumers. According to Experian data, auto premiums already cost consumers an average of $2,100 annually, making it crucial to explore potential savings.

At O1ne Mortgage, we understand the importance of managing your finances effectively. If you’re looking for ways to save on your mortgage or need any mortgage services, call us at 213-732-3074. Our team is here to help you find the best solutions for your needs.

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