SOME ANSWERS. I JUST GOT THE MAIL AND I WAS EXTREMELY SHOCKED. MICHELLE ROBERTSON SAYS HER CAR INSURANCE PAYMENT RECENTLY JUMPED BY $60 A MONTH. THAT’S $720 EXTRA PER YEAR. WE’RE LIVING PAYCHECK TO PAYCHECK AS IT IS, AND SO HAVING A BILL THAT YOU NEVER SAW COMING IS A HUGE INCONVENIENCE. BUT I’M HEARING THAT A LOT OF PEOPLE’S INSURANCE IS GOING UP. THAT’S RIGHT. ACCORDING TO THE LATEST CONSUMER PRICE INDEX DATA, CAR INSURANCE RATES NATIONWIDE WENT UP 22.6% FROM APRIL 2023 TO APRIL 2024. INSURANCE ADVISER HAROLD NEWBILL TELLS ME IN CALIFORNIA, THE INCREASE FOR AN AVERAGE DRIVER COULD BE BETWEEN 15 AND 30%. A BIG REASON IS INFLATION. THE COST TO REPAIR VEHICLES. YOU KNOW, IF YOU THINK OF LABOR PARTS, THE COST OF FUEL TO DELIVER THOSE PARTS TO PLACES, ALL OF THOSE HAVE EXPERIENCED A LOT OF INCREASE IN THE LAST COUPLE OF YEARS. NEWBILL ALSO SAYS MORE ACCIDENTS MEANS MORE CLAIMS AND HIGHER PREMIUMS. SO HOW LONG WILL THE INCREASES LAST? IT’S GOING TO PROBABLY BE THIS WAY FOR A LITTLE WHILE. STILL, NEWBILL SAYS. THERE ARE WAYS PEOPLE CAN TRY TO KEEP THEIR CAR INSURANCE COSTS DOWN, ESPECIALLY FOR FAMILIES WITH NEW TEEN DRIVERS. BUT THEY CAN APPLY TO ANYONE. THERE ARE TEEN SAFE DRIVER COURSES PUT ON. THOSE ARE GOOD IDEAS FOR ANY PARENT LOOKING TO SAVE A LITTLE MONEY. THERE. I THINK SOME OF IT’S ALSO CAR CHOICE. THERE’S ALSO AN OPTION FOR LOW INCOME CALIFORNIANS THROUGH CALIFORNIA’S LOW COST AUTO INSURANCE PROGRAM TO QUALIFY, DRIVERS MUST MEET THE INCOME ELIGIBILITY REQUIREMENTS, HAVE A VALID CALIFORNIA DRIVER’S LICENSE, OWN A VEHICLE VALUED AT $25,000 OR LESS, AND HAVE A GOOD DRIVING RECORD. MEANWHILE, NEWBILL SAYS THE CALIFORNIA DEPARTMENT OF INSURANCE AND STATE LAWMAKERS ARE WORKING TO CHANGE THINGS. THE HOPE IS THAT WE CAN FIND A MORE BALANCED METHOD OF RATES CLIMBING MORE CONNECTED TO A SLOWER INCREASE THAN LARGE INCREASES PEOPLE ARE SEEING. REPORTING IN SACRAMENTO, ORKO MANNA KCRA THREE NEWS. LATE LAST YEAR, THE CALIFORNIA DEPARTMENT OF INSURANCE ISSUED A BULLETIN RESPONDING TO CONSUMER COMPLAINTS ABOUT THE CHALLENGES OF GETTING CAR INSURANCE. IT REMINDS INSURERS THAT THEY ARE REQU
Car insurance costs in California are going up. Why that’s happening and what you can do
According to data from the Consumer Price Index, auto insurance rates went up 22.6% from April 2023 to April 2024.
Updated: 7:24 PM PDT Jun 11, 2024
If you noticed a big jump in your car insurance rates recently, you are not alone.According to the latest Consumer Price Index data, compiled by the U.S. Bureau of Labor Statistics, motor vehicle insurance rates nationwide went up by 22.6% between April 2023 and April 2024. That percentage accounts for the U.S. city average.McClatchy Insurance Agency insurance advisor Harold Newbill said the rate increases in California vary depending on the insurance company and many other factors. “If they’re a safe driver in California, you might be 15, 20, maybe even 30%,” Newbill said.So, what is causing the increases?Newbill said there are several reasons why car insurance costs are going up. One reason is increased costs in other sectors.“The cost to repair vehicles, you know if you think of labor, parts, the cost of fuel to deliver those parts to places, all of those have experienced a lot of increase in the last couple years,” Newbill said.Another reason is that more accidents on California roadways lead to higher premiums and more healthcare costs.“When someone’s injured in a car accident, the cost of that four or five years ago, you’ve seen pretty significant increases in that, and the amount of time that they’re injured to receive medical care, so those costs are also something insurance companies experience. And I would say litigation. People, when they get hurt, that’s pretty severe the cost of healthcare, the cost of litigation in California,” Newbill said.Newbill said that during the pandemic, many insurers put a pause on increases because people were driving less. But now, due to the losses they incurred, they are not taking new clients and in some cases, dropping clients. Newbill also said some insurers have taken more drastic measures.“Others have taken the choice of leaving the state entirely or canceling those policies, so that leaves a lot of people searching for insurance in a market where there’s a lot less options,” Newbill said.Late last year, the California Department of Insurance issued a bulletin responding to consumer complaints about the challenges of obtaining a policy. It reminds insurers that they are required by state law to seek approval before increasing rates. The bulletin reads in part:“Property and casualty insurers subject to the provisions of Proposition 103 in California are required to submit complete rate applications to the Insurance Commissioner for review and approval before implementing any change to existing rates.”The California Department of Insurance and state lawmakers are working to address high insurance costs and access to auto insurance.“The hope is that we can find a more balanced method of rates climbing, more connected to a slower increase, than large increases people are seeing,” Newbill said.Meanwhile, Newbill said there are ways drivers can try to save money on their car insurance costs. He said people can take safe driver courses and buy a vehicle that is easier to ensure.There is also an option for low-income Californians, through California’s Low Cost Auto Insurance program. To qualify, drivers must meet the income eligibility requirements, have a valid California driver’s license, own a vehicle valued at $25,000 and have a good driving record.See more coverage of top California stories here | Download our app.
If you noticed a big jump in your car insurance rates recently, you are not alone.
According to the latest Consumer Price Index data, compiled by the U.S. Bureau of Labor Statistics, motor vehicle insurance rates nationwide went up by 22.6% between April 2023 and April 2024. That percentage accounts for the U.S. city average.
McClatchy Insurance Agency insurance advisor Harold Newbill said the rate increases in California vary depending on the insurance company and many other factors.
“If they’re a safe driver in California, you might be 15, 20, maybe even 30%,” Newbill said.
So, what is causing the increases?
Newbill said there are several reasons why car insurance costs are going up. One reason is increased costs in other sectors.
“The cost to repair vehicles, you know if you think of labor, parts, the cost of fuel to deliver those parts to places, all of those have experienced a lot of increase in the last couple years,” Newbill said.
Another reason is that more accidents on California roadways lead to higher premiums and more healthcare costs.
“When someone’s injured in a car accident, the cost of that four or five years ago, you’ve seen pretty significant increases in that, and the amount of time that they’re injured to receive medical care, so those costs are also something insurance companies experience. And I would say litigation. People, when they get hurt, that’s pretty severe the cost of healthcare, the cost of litigation in California,” Newbill said.
Newbill said that during the pandemic, many insurers put a pause on increases because people were driving less. But now, due to the losses they incurred, they are not taking new clients and in some cases, dropping clients. Newbill also said some insurers have taken more drastic measures.
“Others have taken the choice of leaving the state entirely or canceling those policies, so that leaves a lot of people searching for insurance in a market where there’s a lot less options,” Newbill said.
Late last year, the California Department of Insurance issued a bulletin responding to consumer complaints about the challenges of obtaining a policy. It reminds insurers that they are required by state law to seek approval before increasing rates. The bulletin reads in part:
“Property and casualty insurers subject to the provisions of Proposition 103 in California are required to submit complete rate applications to the Insurance Commissioner for review and approval before implementing any change to existing rates.”
The California Department of Insurance and state lawmakers are working to address high insurance costs and access to auto insurance.
“The hope is that we can find a more balanced method of rates climbing, more connected to a slower increase, than large increases people are seeing,” Newbill said.
Meanwhile, Newbill said there are ways drivers can try to save money on their car insurance costs. He said people can take safe driver courses and buy a vehicle that is easier to ensure.
There is also an option for low-income Californians, through California’s Low Cost Auto Insurance program. To qualify, drivers must meet the income eligibility requirements, have a valid California driver’s license, own a vehicle valued at $25,000 and have a good driving record.
See more coverage of top California stories here | Download our app.
