The impact of inflation on auto insurance rates

One of the significant and sudden impacts of the pandemic was people suddenly started driving far less than before. Subsequently, there were fewer auto insurance claims nationally. In response, many auto carriers offered discounts and rebates on insurance premiums.

As the world has gone back to a sense of “normalcy” and more drivers are back on the roads, accidents are back on the rise which means drivers nationwide are experiencing a much higher accident frequency than they had in the past two years. This rising trend has caused auto insurance rates to rise.

Although rates are personalized for drivers based on several factors such as the driver’s age, type of vehicle, driving history, coverage type, and geographic area, customers can still expect an increase in premiums. These rate changes stand to affect more than 62.5 million policyholders across the country.

Even if you do not file a claim, an increase in others’ claims can also increase the rates for you and other drivers in your area. According to an article by Bankrate, nearly 450,000 policyholders in Illinois may face an almost 11% increase, and almost 500,000 Minnesota policyholders could see a 36% increase.

 

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