Why did my auto premium increase?
At Ellis Insurance, we are just like you. We drive cars, we have families, and we purchase our own insurance policies. We understand that nobody wants to pay more for insurance, and some premium increases seem arbitrary…especially for claim free drivers with good driving records.
Insurance premiums are not arbitrary. There are technological advancements, national trends, and even economic factors which impact auto premiums.
More injuries and fatalities
According to the National Safety Council (NSC), motor vehicle fatalities are up 14% since 2005, and motor vehicle accidents injuring 4.6 million people have been estimated to cost our society $432 billion. The NSC contributes these increases to driver complacency; speeding, distracted driving, and driving impaired.
In 2015 alone, 3,477 people were killed, and 391,000 more were injured in motor vehicle crashes involving distracted drivers. Approximately 660,000 drivers are using cell phones while driving. The potential for deaths and injuries on U.S. roads is enormous, with teens being the largest age group reported as distracted at the time of fatal crashes. (NHTSA)
More vehicles on the road
With more cars on the road, there are that many more “opportunities” for an accident. New car sales have increased steadily since 2009 to a record high 17.6 million cars and trucks in 2016. (CNN)
More affordable fuel & more miles behind the wheel
Falling gas prices are the result of two major economic forces: abundant fuel supplies and declining crude oil costs over the past few years. Lower gas prices motivate more people to jump in their car and drive; more people are on the road than ever before. (AAA). According to the Federal Highway Administration, U.S. driving topped 3.2 billion miles in 2016. This marks the fifth straight year of increased traffic on public roads across the nation. (FHWA)
Today’s cars may be safer, but research by the Insurance Research Council shows that the severity (cost) of auto claims is increasing at a rate that outpaces the decline in claims frequency. The average cost per bodily injury claim grew 32% since 2005. The rising costs of medical services and increase in expensive safety features in newer cars will continue to increase the average cost of claims. (VERISK)
What’s the most effective way to manage your auto insurance premiums? Contact us today for an Ellis Insurance Tune-up