- Dan Frankel
Why Did My Auto Premium Increase?
Updated: May 17, 2022
At Acacia Insurance, we are just like you. We drive cars, we have families, and we purchase our own insurance policies. We understand that nobody wants to pay more for insurance, and some premium increases seem arbitrary…especially for claim free drivers with good driving records.
Insurance premiums are not arbitrary. There are technological advancements, national trends, and even economic factors which impact auto premiums.
What is going on?
5,000 trips to the moon and back.
On average, U.S. drivers put nearly 3 trillion miles on our highways and roads each year, enough to travel to the moon and back almost 5,000 times. More miles driven translates to more "opportunities" for an accident.
43% Increase in collision severity and a frightening increase in traffic deaths.
When accidents happen, they are more expensive than before. In fact, there has been a 43% increase in the cost of replacement parts and the fatality rate for auto accidents is up 26%. -III.org, U.S. Bureau of Labor Statistics
42% Increase in collision frequency.
Distracted driving and smartphones have a real impact; at any moment, nearly 600k drivers are using cell phones or electronic devices.
40.5% Increase in used car prices.
According to the U.S. Bureau of Labor Statistics, the average price of used cars and trucks went up 40.5% in 2021 alone. New car prices are up, too, with the average new car price a staggering $47,100. This leaves car buyers — and insurance companies, if a claim is involved — with fewer and more costly options
20% Increase in the average cost to repair.
Whether it's new tires, wiper blades, or repair parts after an accident, the cost of motor vehicle parts and equipment is up 20% in 2022, compared to 2021.
Each day 9 people are killed and 1000+ injured in crashes attributable to a distracted driver.
Motorists using mobile devices while driving are 4x as likely to get into serious crashes.
Sure, today’s cars may be safer, but research by the Insurance Research Council shows that the severity (cost) of auto claims is increasing at a rate that outpaces the decline in claims frequency. The rising costs of medical services and increase in expensive safety features in newer cars will continue to increase the average cost of claims. (-Verisk)
Ready to learn more?
What’s the most effective way to manage your auto insurance premiums? Acacia Insurance has been helping to make the unexpected uneventful since 1988, and we look forward to working with you. Please contact us with questions and for additional information.