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Truth behind auto insurance rate hikes

Staff Writer | August 4, 2016
Car insurance premiums are up nearly 11 percent over five years ago, and up 3.3 percent over 2015, though with significant volatility nationwide.
Auto insurance
Cars and drivers   The Zebra explored millions of car insurance premiums
The Zebra, a car insurance comparison marketplace, distributed the findings of its first annual State of Auto Insurance Study.

The Zebra explored millions of car insurance premiums as impacted by common variables such as state, age, gender, financial behaviors, and vehicles.

Using pricing data from the past five years, The Zebra explored millions of car insurance premiums as impacted by common variables such as state, age, gender, financial behaviors, and vehicles.

DUI raises car insurance rates 3,200% higher than texting while driving does. Cell phone use and texting while driving have the least impact on auto insurance premiums nationwide, raising rates only 2 percent. In contrast, driving under the influence raises rates over $1,000.

New vehicle safety technology won't save drivers—money, that is. Despite plentiful new in-car safety technology, only electronic stability control (ESC) shows any reduction on average national rates - though it saves just $5 per year.

In fact, 17 states show no savings at all for safety devices including blind spot warning, collision preparation systems, lane departure warning, night vision, and rear-view cameras.

Monitoring driving with telematics doesn't benefit the drivers. Telematics devices, which drivers plug into their vehicles to record how (and how much) they drive and presumably help insurers better predict risk, only yield users an average of $9 (less than 1%) in annual savings.

What actually is impacting car insurance rates?

Who you are:

Men, unmarried people, renters, and those with low education and low credit scores pay more for car insurance, respectively, than women, married people, homeowners, and those with higher education and higher credit scores.

Teens pay more than double for car insurance than any other age group, with 16-year-olds paying nearly $6,500 annually.

How you drive:

A DUI raises car insurance rates 80 percent. And though DUIs increase rates the most nationally, 23 states cite racing as the costliest violation, 16 cite DUI, and others cite reckless driving and at-fault accidents.

Mileage hardly impacts car insurance rates at all; those who drive more than 15,000 miles per year only pay 6 percent more for car insurance than those who drive 0-7,500 miles per year.

Where you live:

10 least expensive states for car insurance:

Ohio - $764
North Carolina - $817
Idaho - $919
Maine - $937
Iowa - $971
Indiana - $996
Virginia - $1,002
Illinois - $1,003
Massachusetts - $1,004
Utah - $1,015

What you drive:

Of the most popular cars by annual U.S. vehicle sales, these 2016 models have the lowest rates:

Sedan: Chevrolet Cruze ($1,376)
Truck: Toyota Tacoma ($1,363)
SUV: Honda CR-V ($1,232)
Van: Honda Odyssey ($1,260)
Luxury car: Acura RDX ($1,429)
Hybrid/electric car: Toyota Prius ($1,469).


 

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