It’s not just you! Rates for everyone on personal and commercial auto policies are going up – and it’s not exclusive to one or two companies! Every insurance company is reporting losses on auto lines for a few reasons:
- More accidents – 2016 saw fatalities from car crashes go up by 6% and the cost of these crashes went up to 12%.
- More distracted – 660,000 people are using phones and devices at any given moment across the US.
- Cars cost more – parts cost about 17% more than they used to. Bumpers aren’t just bumpers anymore; they have sensors, cameras and other circuitry. As our cars get more advanced, the cost to fix them goes up too.
- We’re driving more – all of us drive 3.2 trillion miles in 2016, the 5th straight yearly increase.
But I haven’t had an accident! Why is this affecting me?
Insurance costs and rates are based on the collective experience of all drivers on the road – not just you. Even though you may not have had an accident, the people living and driving around you are causing rate increases for everybody. We’re already able to lower your rates with discounts like the California Good Driver credit and credit for lower miles driven – this is why we ask for your annual miles driven on personal lines. On commercial lines, making sure your drivers are qualified and safe should become part of your risk management strategy.
What can I do?
The only way for rates to go down across the board will be for all of us to drive more responsibly. For every driver that uses Facebook while driving without crashing, there’s another who causes an accident. It’s on all of us to encourage safer driving habits.
That said, here are a few ideas for you and/or your business:
- Businesses should check the motor vehicle records (MVRs) of their driving employees regularly. The DMV offers a cheap, easy to use program for employers to get direct access to employee’s MVRs.
- Implement driver safety policies – a comprehensive driver’s handbook, job-appropriate vehicle management, and prompt reporting of incidents are all useful tools. A “how-is-my-driving” program can also encourage responsible behavior.
- Over 55s should look into taking mature driving courses. These courses help reinforce safe driving techniques AND some carriers offer a discount.
Download the Hanover and Nationwide flyers on auto rate increases here – sources for our data are included! If you have any questions you can always pick up the phone and talk to us about your auto insurance and ways to help.