Drivers in the United States can expect further increases in auto insurance costs in 2024, as different aspects continue to put pressure on the sector.
According to a USA Today report, the increase in natural disasters, the costs of medical claims and vehicle theftsamong others, will cause auto insurance rates to continue rising in 2024.
Replacement costs will also continue to affect future rates as insurers adjust to rising consumer costs. 45% from 2020 to 2023.
Drivers looking for the best car insurance next year can expect higher pricescommented Mark Friedlander, Director of Corporate Communications at the Insurance Information Institute (Triple-I).
“Auto insurance rates are expected to continue rising in 2024 due to More expensive repairs, driven by parts shortages and higher labor costs, as well as low vehicle inventories, resulting in higher totaled auto replacement costs.”
Triple-I highlights that the sum of the above factors will lead to higher premiums: “The US auto insurance industry is expected to post a substantial underwriting loss in 2023 with a combined ratio of 110.5, meaning they are paying $1.10 for every dollar collected in premiums“.
According to Bureau of Labor statistics, auto insurance rates increased 18.9% year over year, and as Friedlander mentioned, replacement and repair costs are putting pressure on that increase, although they are not the only factors weighing.
According to the report, rates are also increasing due to:
The number of accidents has decreased since 2021, but speed-related deaths reached a maximum of 14 years. These accidents are often serious and lead to more litigation over claims.
The tropical cyclones and hurricanes They generate million-dollar losses, and to compensate, insurers have to subsequently increase premiums.
Increase in car theft
The car theft rate hit near record levels in 2022 with a 7% increase year over yearand the trend continued in the first half of 2023, according to the National Insurance Crime Bureau.
Increase in medical expenses
With the more expensive medical costsauto insurers, have higher payouts for bodily injury liability claims.
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