Auto insurance is required in most states as a way to cover your own liability and provide compensation to others in the event that you’re responsible for an accident. Despite this, approximately 13 percent of drivers drive uninsured.
Unfortunately, it’s the drivers who follow required insurance laws who end up paying the price in the form of uninsured motorist coverage. According to the Insurance Research Council, uninsured claim payments have risen by 75 percent over the past 10 years, resulting in a $14 premium increase for every insured individual.
Autonomous Vehicles
Although autonomous vehicles that can drive themselves have the potential to save lives and reduce injuries, they could also decrease the personal automobile insurance sector to less than 40 percent of its current size. While this change should be gradual, many insurance carriers have been slowly increasing their rates in anticipation of the shrinking market.
Insurance Fraud
Insurance is meant to protect you in the event of an accident, but many criminals try to illegally use insurance policies for their personal gain. Most fraud schemes involve a policyholder faking an injury and blaming a third party, or conspiring to cause an accident that can be blamed on someone else.
Although insurance carriers attempt to uncover the truth during all insurance claims, the Insurance Information Institute estimates that insurance fraud costs the United States $32 billion per year. Unfortunately, much of this cost is transferred to law-abiding policyholders.
Price Optimization
Insurers commonly use applicants’ credit history as a factor in determining car insurance rates. However, they also use a practice called price optimization to see rates before they decide to choose another company. For example, customers who tolerate small, regular increases to their internet or cable bills are more likely to stay loyal to their insurance carriers when premiums increase.
How Can You Save During a Hard Market?
With auto insurance premiums on the rise for the foreseeable future, it’s more important than ever to be aware of the steps you can take to save on your premiums. Contact us at 609-586-7474 to discuss your options for saving on your auto policy, even during a hard market.
Image Attribution – Accidents Happen – By Mourning Kolhoff
