Kapasu Insurance Services Inc. Blog
Recent events of 2020 have been affecting not only the medical field but also the insurance industry. The current pandemic has mandated the U.S. citizens to stay at home and park their cars in their garages more often. As a result, fewer drivers on the road means fewer accidents.
Disasters and economic factors like failing to turn an underwriting profit cause the insurance rates to multiply. Insurers are adjusting for their consistently increased losses.
How These Factors are Affecting Auto Insurance Rates
Disasters result in insurance claims that cost billions of dollars. Not only home insurers were affected, but the auto insurers as well. Driving distractedly also led to an increase in accidents on the road. These factors contribute to high losses for insurers.
Natural disasters like hurricanes, wildfires, and the recent pandemic bring considerable losses to insurers in the past years. Auto insurances usually cover damages from natural disasters. These insurances cover repair costs or even replace damaged cars. Comprehensive claims manage to give more significant losses for auto insurers.
People using phones while driving is a significant contributor to increased driving accidents. The National Highway Traffic Safety Administration (NHTSA) published a report that says 2.443 million people were hurt in distracted driving crashes in the past six years. Insurers counter by rising insurance rates to make up for the increasing claims they have to payout.
Expensive repair costs
New vehicles mean new technology means an increase in repair costs. As of May 2018, NHTSA announced that all of the newly produced cars must have backup cameras. Thus, making previously cheap repairs to more expensive ones like a bumper replacement, leading to more losses for insurance companies.
When will Auto Insurance Rates decrease?
It is hard to predict when auto insurance rates will decrease, as there are many factors to pricing insurance rates. If the factors above continue, consumers must expect that auto insurance rates are less likely to go down.
On the contrary, if these factors reverse and fewer accidents happen, auto insurance rates could steady or even decrease. Since some factors are beyond the driver’s control, the best way to save money is to get auto insurance with the best coverage.
At Kapasu Insurance Services, we do our best in making sure that our clients are well-protected with affordable and comprehensive policies. We make sure to go the extra mile to help you with your needs. To learn more about how we can help you, please contact our agency at (760) 995-3853 or Click Here to request a free quote.
Old Town Victorville-Veteran's Memorial-Seventh St-Forrest Ave photo by Mlpearc | CC-BY-SA-3.0 | Website by InsuranceSplash