HomeCar InsuranceRising auto insurance rates have drivers asking why?

Rising auto insurance rates have drivers asking why?

NEW ORLEANS (WVUE) – It is not hard to find drivers who are concerned about what is happening to their car insurance premiums.

Corey Richardson says his premium is higher, and his insurer has not explained why.

“I’m with Progressive and they went up $60 on mine. I was paying $334 a month and now I’m paying $398. (SW) Did they give you a reason?” said Richardson. “They didn’t give no reason.”

Cedrick Jones drives a pickup truck and said his insurance costs are higher, too.

“It seems like it’s steadily rising, like me I paid insurance for like five or six years without making one claim and the next thing you know it jumps up on you,” said Jones.

The federal government’s Consumer Price Index says the 12-month percentage change for December 2023 for motor vehicle insurance was 20%. From November 2022 to November 2023, the change was 19.2%.

Jones said he is glad he is employed as insurance rates go up.

“I don’t know how we’re going to afford it,” he said.

Stephen Lovecchio is a veteran insurance agent in New Orleans and a branch owner of TWFG Insurance.

“Technically, everybody took a rate increase last year, it just kind of depends on the parish that you’re in,” said Lovecchio.

He said Orleans Parish has the highest rates and one zip code, in particular.

“Orleans 70115,” said Lovecchio.

Rates have not just begun increasing.

“Over the last 10 years our average automobile insurance policy that’s generally a two-car policy, full coverage used to be $3,000 a year, now it’s a little bit over $5,000,” said Lovecchio.

Lovecchio says the percentage of increases he is seeing now are double digits.

“On average, it’s been 15% now obviously we don’t represent all carriers but what we’ve seen though people with multiple accidents their premium going way up,” he said.

Still, he says during the height of the COVID pandemic, insurers decreased rates.

“A couple of years ago with COVID all the carriers dropped price, they dropped it because nobody was driving and once those prices got dropped when people started driving again there were a lot of people that didn’t follow the rules of the road, forgot how to drive and prices of the cars just to get fixed skyrocketed due to our problems with the supply chain,” Lovecchio stated.

And, in terms of auto insurance, many things affect individual premiums but not the color of a car.

“There’s no red car, [it’s not] if you have a red car you’re going to pay more for it, it’s just going to be age, not sex and the type of vehicle that you have,” said Lovecchio. “American cars are going to be cheaper to insure for comprehensive and collision because the parts are cheaper than a European car.”

And weather conditions have an impact.

“We have a lot of rain every year,” said Lovecchio. “When it’s raining roads are slick and when people aren’t paying attention and somebody stops in front on them and they put on their brakes they end up hitting the car in front of them,” he said.

Also, the technology that is in new vehicles makes repairs more expensive.

said the technology in new vehicles also makes repairs more expensive.

And 2024 may not bring relief, in the short term.

“I think we have a little bit more stabilization to go, the carriers are taking rate, some are taking more than others,” said Lovecchio.

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