Auto insurance will get more expensive in 2022, after falling in 2021, according to a new study. ValuePenguin's State of Auto Insurance in 2022 report finds that auto insurance rates will rise by 0.6% this year as Americans resume normal economic activities. That will push the average cost of auto insurance to nearly $2,000 a year, (or $1,935 annually), with 22 states seeing car insurance premiums increase in 2022.
Here are the report's key findings:
- The Omicron Variant's Impact on Car Insurance in 2022: The Omicron variant's impact on Auto Insurance rates should be minimal. Insurers are not likely to give out COVID-19 discounts to drivers unless there is another nationwide lockdown.
- The average cost of car insurance in 2022 is $1,935/year. Michigan, Florida and Louisiana will have the highest, and Maine, Texas and Wisconsin the lowest car insurance premiums in 2022.
- 22 states will see car insurance rates increase by 1% or greater in 2022, Nebraska (4.4%), Minnesota (2.5%) and Arizona (2.2%) will experience the largest rate hikes in 2022. In 14 states however, car insurance premiums will fall by an average of 1%.
- Unsafe Drivers will pay 55% more for Auto Insurance in 2022. Texan drivers will experience the steepest increase in premiums (142%) if they get a ticket or get into an accident in 2022.
Despite the increase, Divya Sangam, Insurance Spokesperson at ValuePenguin.com says rates are still below pre-pandemic levels: "Prior to 2020, we saw premiums increase anywhere from 5 - 6% respectively. In fact, rates increased every year from 2011 to 2020." She adds, "While Insurers may not be giving out COVID discounts, there are still ways to save. 76% of Americans who shopped around for insurance say they saved hundreds of dollars doing so."
Researchers predict that premiums will continue to rise in 2023, as Americans return to their pre-pandemic lives. For one there will be more cars on the road, leading to more accidents, and more claims. They also attribute the rise in premiums to a steep increase in distracted driving, more expensive repairs from smart technology in cars and supply chain shortages.
About the Study
ValuePenguin.com, part of Lending Tree, analysts reviewed 15 million auto insurance quotes for different drivers across 35,000 Zip Codes and 72 insurers. These, combined with RateWatch filings, were used to present the current and historical pictures of the auto insurance industry and how consumers will be impacted.
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