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Car insurance costs: Comparing auto insurance rates needed as premiums jump higher

The average motorist will spend around $1,771 on car insurance this year.

That annual cost represents a huge increase from 2019. The average annual premium for auto insurance then was $1,070, according to the National Association of Insurance Commissioners.

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Rod Griffin, Senior Director of Consumer Education and Advocacy for Experian says insurance rates have increased alongside most goods and service. The U.S. Bureau of Labor Statistics reported that January prices were 7.5% higher than one year ago. That’s the largest increase since 1982.

“Price increases have also impacted auto insurance costs,” he explained. “According to the S&P Global Market Intelligence’s annual U.S. Auto Insurance Market Report, auto insurance rates are expected to increase this year.”

Griffin says consumers can’t control inflation, but there are ways to bring down total costs. For example, assessing your current policy and comparison shopping for more affordable rates.

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Did the pandemic cause higher car insurance rates?

Early in the pandemic insurance companies offered payment relief or premium refunds for drivers. They also offered pauses on insurance cancellations and more. “Now, according to industry and media reports, insurers may hike premiums from 6% to upwards of 10% this year,” he explained. “There are likely many factors behind the decision to increase insurance rates, but we can speculate that inflation is playing a big role in those increases.”

Is shopping for a different auto insurance policy smart right now?

Griffin says it’s always smart to shop for better coverage. “Consumers should feel empowered to comparison shop and find a better rate that works for them and their needs,” he explained. “I recommend doing this at least once a year to make sure they are obtaining the best rates possible.”

Experian offers a free auto insurance shopping service that can help take the hassle out of finding better car insurance rates. 

What if you’re a remote worker and driving less?

Griffin says many workers have seen evolving commutes given the increase of remote work. “These consumers should reach out to their insurance carriers to see if they can receive a reduced rate or extra discounts,” he explained. This means discounts for driving less or learning about other options to lower costs. “Additionally, these consumers can consider opting-in to a driver tracking programs that provides their insurance company with more information about their specific driving habits in exchange for a reduced insurance bill.”

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