Car insurance premiums are rising the most in these states
Why Americans will need to budget even more for car insurance in 2023
For this reason, you may pay more for your car insurance in 2023.
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Auto insurance is one of many household expenses that Americans are expected to pay more for this year. While industry experts predicted a slowdown in insurance price increases, data from the first half of the year shows a 15% increase in comprehensive insurance premiums.
A recent report from Insurify, a car insurance comparison website, shows that the average cost of car insurance in the U.S. has been steadily increasing since 2021. The estimated cost of coverage is expected to rise to $2,469 by the end of the year.
Drivers in California are hardest hit by the rise in car insurance premiums – prices are expected to rise by over 50% by the end of 2024.
Car insurance premiums are expected to rise nationwide:
Compare car insurance premiums: Check rates based on your personal factors here to get the best deal
Where is car insurance most expensive in the country?
Insurify’s report found that California, Missouri and Minnesota could see premiums rise by more than 50% this year. Insurify said damage from severe storms and weather events such as wildfires, as well as state laws on insurance coverage, could contribute to rising premiums in the states.
Law changes in Maryland and South Carolina increase insurers’ financial responsibility – such changes could lead to higher premiums for drivers, the report says.
From the beginning to the end of 2024, car insurance is expected to become 22 percent more expensive on average nationwide.
Here’s how predicted auto insurance premiums vary at the state level:
Car insurance: Why did my car insurance increase in 2024?
Cassie Sheets, a data journalist at Insurify and author of the report, said three of the 10 states with the most expensive car insurance have no-fault systems.
“In these states, drivers file claims with their own insurance companies to receive compensation for their injuries, regardless of which party caused the accident. No-fault systems are designed to speed up the processing of claims, but they also provide opportunities for insurance fraud,” Sheets wrote.
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Why are car insurance premiums rising?
Car insurance premiums depend on the type and amount of coverage needed, personal driving habits and where the driver lives, USA TODAY reported. Insurers set premiums based on the cost of running a vehicle, including the cost of covering claims.
Repair rates, claim severity, climate change and an increase in car thefts have led to higher operating costs for insurers.
As repair costs have increased, insurers have to bear more costs, which in turn is reflected in higher premiums for policyholders.
For more information on saving on car insurance, check out USA TODAY’s coverage of new car insurance deals.
