Yes... car insurance rates are rising! Sorry to be the bearer of bad news, but I wanted you to hear it from me first. There are a variety of "perfect storm" circumstances that are contributing to this nationwide automobile insurance rate rise. Below is information shared from Farmers Insurance along with charts and data points to back it all up. Please contact me for questions about how any rate increase could impact you and your policies. Thank you for reading and we're always here to assist you!
We will address four primary areas about why car insurance rates are rising, time put on your macro-economics hat here! Let's dive in...
How A Stronger Economy Leads to More Accidents!
As the economy continues to improve, more consumers are purchasing vehicles, and low gas prices are putting more cars on the road for longer distances. An increase in overall miles driven is increasing the number of auto accidents and fatalities. New car sales are at record highs and the technology in these cars makes them much more expensive to repair. This means that we are seeing both an increase in the number of claims and the average cost of a claim. The charts below show mileage, gas price and vehicle sales as they relate to this topic.
Let's break it down for you...
Less Unemployment = More Jobs
More Jobs = More Traffic
Cheaper Gas = More Driving
More Driving = More Accidents
More Cars Sold = More Traffic
More Accidents = More Insurance Claims
More Insurance Claims = Higher Policy Rates!
We realize that most of these factors are well outside our control, somehow it feels better to know WHY things are changing, since knowledge is power. We also realize your personal driving habits may not have changed at all and we are at the mercy of the road.
We recognize that some of this information may create an uneasy feeling... if so, please contact us to talk about it. We have cookies and milk at the Oakland office too, if that would help!
Our goal is to be clear and transparent with you about all your insurance needs, your trust is paramount to our success. We truly value your business!
Ruth Stroup & The Insurance Lady Team