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By Bob Miller, CPCU
Owner, Brightway, Palencia
You may have noticed your cost of Auto insurance going up and are wondering, “I’m a safe driver. Why are my rates going up?”
That’s a question many drivers are asking themselves as Auto rates are on the rise across the board.
Based on a number of studies, here are key factors affecting Auto insurance premiums that you can share with your customers, clients, friends and family.
Lower Gas Prices
Gas prices have remained low for the last few years, which leads to people driving more. More driving and more vehicles on the roads typically results in more crashes.
With more than 212 million licensed drivers and more than 263 million registered passenger vehicles on U.S. roadways, we’re sharing the road with more motorists and cars than ever before.
Increase in Distracted Drivers
Many point to this area as the biggest reason rates are going up because distracted drivers can cause, or have a harder time avoiding accidents. Not only is texting while driving a problem, but so is anything that takes your eyes and mind off the road, such as talking on the telephone, adjusting or viewing a navigation system and changing the radio station. Still common are people reading books, fixing hair, shaving, eating and attending to children, pets or others in the car. All of these can divert attention, even for a short time.
Increase in Impaired Drivers
Most think of drinking when driving, but more people are using drugs, illegal and legal. So many medications include warnings about potential problems when taking prescription drugs or over the counter medications. Common medications can reduce ability to think or react as one would normally, even if one doesn’t notice.
Lack of Courtesy
Tailgating, speeding, running red lights, turning right on red without even stopping are all symptoms of the lack of courtesy we all see every day that lead to the increase in accidents.
Higher Cost of Repairs
Cars cost more and are more complicated than they have ever been. A seemingly small bump in a parking lot can cause what looks like minor damage, but the actual repair cost can be significant if a back-up camera is damaged. With some car bodies now made of mainly aluminum and plastic, they damage easier. Any damage to the front-end can severely damage the complex engine, electronic and computer components.
Availability of Attorneys
There is no lack of attorneys who specialize in representing people who have been involved in wrecks. As a result, insurance companies incur costs defending you against claims in addition to paying for actual damages.
Increase in Fraud Cases
There are many cases of fraud that impact Auto insurance premiums. Staged accidents, referrals to partner attorneys and medical clinics can lead to significant expenses that are billed to insurance companies.
If you or a customer wants advice on Auto insurance coverage or would like us to shop for coverage for you, contact Brightway, Palencia today.
Sources: Federal Highway Administration, Statista, National Highway Traffic Safety Administration