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Auto insurance rates soaring in 2024: What you can do

Rates jumping for the second year in a row
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Posted at 3:41 AM, Feb 26, 2024

New cars are expensive. Used cars are expensive. Now the cost of auto insurance is going through the roof.

With insurance premiums spiking, some families are struggling to pay for their commute. Kimberly Miller is among them. She's had a clean driving record for more than a decade.

"I can't remember the last time I had a speeding ticket," she said.

But like so many other people, rates on her Chevy Equinox have been rising sharply.

"Up and up and up," she said. "Every six months, it’s gone up."

Recently, her rate jumped from $188 to $210 a month.

Rates for many drivers up sharply this year

Miller isn't the only one seeing these big jumps. Auto insurance premiums are up 26% compared to 2023, according to Bankrate.com.

Bankrate data shows the average driver is paying more than $2,500 a year for car insurance, 3.4% of their median household income.

Shannon Martin is a licensed insurance agent and an analyst for Bankrate.

"We had COVID, we had inflation, we had an over 10% increase in car crash claims. Insurance companies are trying to get back the money they lost," she said.

She says it’s understandable that consumers are struggling.

"People are going to feel stuck between a rock and a hard place," she said.

Things you can do to lower your rate

So what can you do?

"Start off comparison shopping, looking for discounts," she said.

Before you switch, though, talk to your existing provider. Ask if you're currently getting a loyalty discount.” Next, she says, Look at the value of your car.

"If you're paying more to keep collision coverage than the vehicle is worth, you might want to make a change," she said.

Keep in mind that you can’t actually save money by arguing.

"Insurance is heavily regulated, so you cannot negotiate price," Martin said.

She does not recommend switching to a higher deductible plan (where you pay the first $1,000 or $2,000 out of pocket) unless you have enough saved to cover that amount in an emergency.

But as Miller learned, increases may be unavoidable, even if you bundle and are loyal to one company.

"The only thing I get for my loyalty," she said, "is first in the line to call."

Shop around, and consider all your options, so you don’t waste your money.

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