Keep It Down

Ways to save on auto insurance as rates are expected to increase

You might think that auto insurance companies took a hit during the pandemic. Why? Because, as Americans drove less, auto insurers reduced rates and handed out discounts. And yet, you would be wrong. Despite the auto insurers issuing more than $16 billion in refunds, they still earned huge profits because the number of claims plummeted. Well, now that more people are driving again, auto insurance companies are ready for claims to increase, which means, yup, get prepared for prices to rise.

The sheer number of drivers increasing is just one reason auto insurance rates are going to get more expensive. As Marketwatch reports, another factor is that driving has become more dangerous. Despite people driving less, the number of vehicle-related fatalities increased in 2020. Experts said the reason was distracted drivers — don’t text and drive! Another factor that can lead to a surge in auto insurance rates is the cost of making and repairing vehicles. Because driver demand is high and car inventory is low, the average cost of a new car is now at an all-time high, and the average cost of used cars increased by 37 percent. There is also a mechanic shortage, which is driving the cost of repairs up.

Auto insurance rates are going to get more expensive, but you can still take steps to save as much as possible. The best way to save some cash is to shop around for a new deal. Get a quote from at least three insurers and choose the best value for you. If you want to stick with your current company, call and ask about any discounts that might be available. If you don’t drive often, you could try increasing your deductible. There are ways to keep auto insurance costs down, you just have to take some steps to get there.

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-Blog Written by Chris O'Shea from SavveyMoney