Experts Say The Cost Of Car Insurance Is Rising Too – Here’s Why | Web Exclusive News15


LAFAYETTE, Louisiana – News15 spoke with Experian’s senior director of consumer education, Rod Griffin, who said, “Gasoline prices are going up, but that’s not the only increase in the cost of driving – inflation is causing car insurance rates to skyrocket”. So what can local consumers do to save during skyrocketing car insurance rates? Rod Griffin has some advice in this Web News15 exclusive.

Q. Why are car insurance rates going up?

A. The effects of inflation that consumers face can cause your car insurance premiums to rise when it comes time to renew your policy. According to industry and media reports, insurers could increase premiums by 6% to more than 10% this year due to the disruption caused by the pandemic and its economic effects.

This increase in insurance rates is also caused by the shortage of semiconductor chips needed for new vehicles, which in turn affects the cost of new cars. This reduced car inventory also results in fewer and more expensive rental cars, which increases costs for insurance companies when paying for customer rentals. Also, insurance companies pay more to buy comparable cars in this market when a car is totaled.

In addition, like all other sectors of activity, the automotive industry is experiencing a shortage of technicians. The increased need to offer higher compensation to employees to recruit and retain staff also has a potential effect on increasing costs. Add to that supply chain issues with parts needed for repairs and car repair costs that contribute to the list of reasons insurance rates are on the rise.

Do you feel that the cost of your car insurance has increased?

Q. So what can local consumers do to save?

A. Reduce coverage. When the cost of auto insurance gets tight, you might consider reducing coverage. Review your policy and see if you have any add-ons you could do without, such as roadside assistance. If you have an older car that may not be worth the cost of repairs, you can weigh the removal of collision and comprehensive coverage costs against how much you’re willing to spend on potential repairs.

Increase your deductible. One way to get a lower premium now is to upgrade to a higher auto insurance deductible later. Your deductible is the amount you pay after an incident before your insurance takes effect. Raising your deductible will lower your premium now, but you’ll pay more out of pocket if you have an incident later.

Use driver tracking programs. Your insurance premiums are determined by the information the insurer collects to calculate the level of risk to insure you. If you provide them with more information about your specific driving habits by using an app or recording device in your vehicle, it could reduce your costs. With more information about how you drive, the insurance company can lower your rates by 25% or more.

Check the discounts. Has your situation recently qualified you for a new discount such as a senior/retirement discount or student discount voucher? Check out the different discounts from your insurer and see where you can save.

Improve your credit score. Your credit history can affect the price of your car insurance if your insurance company considers your credit-based insurance score. These ratings are based on your credit reports, but consider the likelihood of you filing a claim and being able to raise or lower your rates accordingly. You can check your credit report and score for free to see where you stand and how it might impact your insurance-based credit score.

Repay your car loan. If your vehicle is still financed, your lien holder may require that you carry a higher level of insurance, such as comprehensive and collision damage waiver. If you’re nearing the end of your loan, pay it off and consider reducing or dropping your insurance coverage for something more manageable.

Compare insurance quotes. Price comparison sites, like Experian’s car insurance comparison tool, can help make sure you’re not paying too much for insurance. Experian leverages technology from Gabi®, a car insurance marketplace part of Experian, to compare quotes from over 40 of the best providers in minutes.

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