Why Auto Insurance Rates are going through the roof!

Posted on May 15, 2024

Patrick Bet David provides insight into the reason Car Insurance rates have increased over 40% since 2020.

If you noticed that your Auto Insurance premiums have risen dramatically in the last 4 years, you're not alone. This year alone premiums have increased on average 22%! But why? There are several factors contributing to it, with the following being the most significant reasons:

Increased Frequency and Severity of Accidents: Despite advancements in vehicle safety technology, accident rates have been rising due to factors like distracted driving and increased congestion on roads.

Rising Medical Costs: Healthcare costs, including medical treatments for injuries sustained in accidents, have been consistently rising, leading to higher insurance payouts.

Vehicle Repair Costs: Modern vehicles are equipped with complex technology and expensive parts, making repairs more costly. This increases the amount insurers need to pay out for repairs following accidents.

Natural Disasters: Events like hurricanes, floods, and wildfires have become more frequent and severe, resulting in higher insurance claims for damaged vehicles.

Fraud: Insurance fraud, including staged accidents and exaggerated injury claims, can drive up costs for insurers, who pass these costs on to consumers through higher premiums.

To get more context on the increasing cost of car insurance, please watch the following video produced by Patrick Bet David of Valuetainment.