Auto ins just doubled!

[CKN]

From my understanding it's just very complicated but there are a few main factors.

The biggest one is, IMO, that for both home and auto insurance, the more expensive it is to resolve a claim, the more the insurance will have to cost for them to still make a profit. I don't know much about homes, but from the research and articles and data out there, in the past decade, prices of everything (both materials and labor) have gone up significantly. When it comes to cars, it's the same thing - parts and labor have gone way up. And, the cars themselves have got more complicated and more expensive to repair.

For example, let's compare my previous car, a 2017 Bolt, to my new car, a 2024 Prologue. Let's say an accident damages the front bumper, a wheel and tire, the windshield, and the side mirror. I have no idea if that's a realistic scenario but it's easy to compare.
Bolt: front bumper is just a bumper, windshield is just a windshield, it was a 17" wheel, tires were fairly cheap (and you could replace two to match), and the mirror's a mirror.
Prologue: front bumper has radar sensors. Windshield has a front facing camera for driver assistance which will need calibration, wheels are 19" so cost a bit more, tires are vastly more expensive and it's AWD so they need to all match so now you're buying four tires. Oh and the mirror has a blind spot thingy so I bet that adds to the price. It's also a lease and Honda leasing requires OEM parts to be used. On a used Bolt I financed the insurance company could have used aftermarket parts.
Now you can see why insurance for the Bolt was about $200/mo while insurance for the Prologue is almost $300/mo. In the end, I bet any repair on the Prologue would be 2x to 4x as much as the Bolt (plus it is also worth about 4x as much if they had to total it), so it's actually a better value to insure overall.

And for car insurance specifically, the amount of people without insurance is another huge problem. If an unlicensed, uninsured, illegal immigrant crashes into my car, and totals it, my insurance company will pay it, but who are they going to go after? The lease buyout is like $40K on my car, let's say that's how much it would cost them. And that's assuming I have no medical issues or anything. Now, if that same driver was properly insured... well, they'd be out nothing because the other persons insurance would end up paying for it. We need to enforce our laws which require insurance. A guy without insurance crashed into my buddy's Corvette and was like "omg I have no insurance what do we do" so my buddy called the cops. They refused to come because nobody was hurt! In my mind, anyone pulled over or encountered in an accident that doesn't have insurance and/or license needs to be cited, have their license suspended if they have one, and have their vehicle impounded until they can provide a valid drivers license and proof of insurance. This would overall lower the cost of insurance for everyone.

Utah has a system where the Insurance companies notify the state when insurance lapses on a vehicle-then the registration is revoked on that vehicle. Obviously-not a perfect system but it's a start.

 

[rijndael]

Roads we drive on?

We have private HOV roads near me, they're owned by Ferrovial. During the peak hours it can be $40-50 to drive a couple of miles. But, that couple of miles will save you a lot of time. Too spendy for me, but I do enjoy it when the family has piled in to the van and we ride for free.

 

[Rand]

State farm.
my house has went up 125% over the last 6 years.
my insurance went up 30% 25% and 25% (or 103% over 3 years)

no accidents or claims.
Sad part I quoted with AAA and it was more than I'm paying.. now getting spammed hard.

I'm tempted to go to progressive but they are dirtbags if you have a claim.. more than most.

 

[Chris142]

Sorry didn't read through the 4 pages, was there any specific component that caused the increase, or every component doubled. I unfortuntately had an accident in 2010 with a loaner car, and it didn't double, it went up by about 30% with the lizard co. upon renewal. The most surprising thing is I switched to the mayhem/hands people, and with the accident factored in, the rate was lower than the lizard co. pre accident. So good chance you can get it back or closer to what it was.

We are both in our 50's. No accidents,no tickets. I got an overweight ticket in 2002 but that's not a moving violation and should be gone by now anyway.

 

[JTK]

We are both in our 50's. No accidents,no tickets. I got an overweight ticket in 2002 but that's not a moving violation and should be gone by now anyway.

I feel ya Chris. My wife and I are in our 50s and I carry 3 kids on my policy. 19M, 21M, 23F. I'm about $500/mo. I'm not coughing up the 6mo amount all at once.

 

[gfh77665]

Many love to hate on insurance companies, and BITOG is no exception. The fact of the matter is, most companies have slim profit margins that are similar to grocery stores (think 3% range). The cost of new vehicles as well as repairing vehicles is absurd right now, that is the true problem.

To some extent, I agree. However, there are some agents making way too much money, and most of all, some companies buying WAY, WAY, WAY too much advertising. How many "Liberty Mutual" commercials have you see with that stupid Emu? It plays like 50X per day on my TV. How many bowl games has Allstate sponsored? You and I pay for all that TV exposure.

 

[brandon9715]

To some extent, I agree. However, there are some agents making way too much money, and most of all, some companies buying WAY, WAY, WAY too much advertising. How many "Liberty Mutual" commercials have you see with that stupid Emu? It plays like 50X per day on my TV. How many bowl games has Allstate sponsored? You and I pay for all that TV exposure.

The only agents that make too much money are the lazy ones that don’t provide a service. I don’t think anyone (in any job sector) makes too much money if they are doing their job well. Agreed that advertising is overdone.

 

[walterjay]

I just checked with AAA. They are about $600.00 less than my current Geico policy. And that is with a higher 300K coverage. I am going to switch to them.

 

[gfh77665]

The only agents that make too much money are the lazy ones that don’t provide a service. I don’t think anyone (in any job sector) makes too much money if they are doing their job well. Agreed that advertising is overdone.

Do you believe some people are underpaid? If so it follows some people are overpaid.

 

[brandon9715]

Do you believe some people are underpaid? If so it follows some people are overpaid.

I don’t believe people are. The free market dictates pay. If someone is paid too little, they have the option to go somewhere else and/or learn new skills.

 

[gfh77665]

I disagree. Pro athletes are a glaring example. 200 million to dunk a basketball? Entertainers, singers, movie stars. Should they really need to be paid a Billion or more? Do you remember the "Pharma Bro"? Shkreli raised the antiparasitic drug Daraprim price to insurance companies from $13.50 to $750.00 per pill.

Yes, I believe in the free market system and I am about as capitalist as you can find, but I am not so naive to think there arn't any distortments and abuses (like above) in compensation. Some billionaire CEO's have ran companies (like Enron) into the ground. Others people have added incredible value to a company way out of proportion to what they are actually paid.

 

[JeffKeryk]

I disagree. Pro athletes are a glaring example. 200 million to dunk a basketball? Entertainers, singers, movie stars. Should they really need to be paid a Billion or more? Do you remember the "Pharma Bro"? Shkreli raised the antiparasitic drug Daraprim price to insurance companies from $13.50 to $750.00 per pill.

Yes, I believe in the free market system and I am about as capitalist as you can find, but I am not so naive to think there arn't any distortments and abuses (like above) in compensation. Some billionaire CEO's have ran companies (like Enron) into the ground. Others people have added incredible value to a company way out of proportion to what they are actually paid.

One man's abuses are another's market value. Capitalism is about winners and losers.
There is no fair; I quit looking for it a long time ago. Would you give all that money back if you were Steph Curry?

I never worked so hard for so little as a tree trimmer. I never had it so freakin' easy paid so high as a lowly computer programmer.
There is no fair.

 

[Pew]

I disagree. Pro athletes are a glaring example. 200 million to dunk a basketball? Entertainers, singers, movie stars. Should they really need to be paid a Billion or more? Do you remember the "Pharma Bro"? Shkreli raised the antiparasitic drug Daraprim price to insurance companies from $13.50 to $750.00 per pill.

Yes, I believe in the free market system and I am about as capitalist as you can find, but I am not so naive to think there arn't any distortments and abuses (like above) in compensation. Some billionaire CEO's have ran companies (like Enron) into the ground. Others people have added incredible value to a company way out of proportion to what they are actually paid.

Like the epipen, $60 to $600 in 10 years. Luckily now we have a generic version available.

 

[ripcord]

Sure, if you make it that way. But Econ is a science that studies the distribution of scarce resources.

Economics is a science only in the same way that psychology is. Economics is merely the human psychology of money and production. There's a reason they're both called "soft science." With both, the answers you arrive at are "squishy" because they are easily manipulated by how one asks the questions and the assumptions one starts out with.

That's what makes economics tightly couple with politics.

 

[JeffKeryk]

Economics is a science only in the same way that psychology is. Economics is merely the human psychology of money and production. There's a reason they're both called "soft science." With both, the answers you arrive at are "squishy" because they are easily manipulated by how one asks the questions and the assumptions one starts out with.

That's what makes economics tightly couple with politics.

Which is exactly what you are doing.

 

[PandaBear]

One man's abuses are another's market value. Capitalism is about winners and losers.
There is no fair; I quit looking for it a long time ago. Would you give all that money back if you were Steph Curry?

I never worked so hard for so little as a tree trimmer. I never had it so freakin' easy paid so high as a lowly computer programmer.
There is no fair.

There is no abuse in an open insurance market. There is no law preventing one from switching insurance companies and there are laws preventing market manipulation on how much to charge one particular person.

Most insurance companies price individual policy holder based on the risk profile they are guessing on. Each company guess them differently, and therefore different result and different rate. Sometimes they got it wrong and lost their shirts, but they usually find out over time because of the law of large numbers. We are all just one number to the insurance industry.

The biggest problem is abuse of insurance fraud, uninsured driver, fire risk not allowed to pass on to the policy holders yet we allow those place to be build to begin with. Maybe if we don't let people build in those area we don't need to worry about fire risk, rather than having them build then later dumping it in the insurance side.

 

[JHZR2]

Also body shops are in short supply. Nobody wants to do that work anymore.

Yet when you look at the actual burdened rates of labor for those functions, they’re really, really low. Particularly when you consider the burdened cost of the labor (ie not just the hourly wage).

 

[PWMDMD]

I'm adding a 4th vehicle and for four drivers (two teens and two adult parents) and four vehicles it's $7500 per year with a $2K deductible and rather generous coverage which I need, because I have a lot to lose. I think three years ago when it was just two adults it was $2500 per year.

 

[dbias]

Insurance is crazy anymore. I sold off my 12 year old transit connect and my insurance went up $15 a month last July. My youngest son turned 25 in August and it went down almost $200 and I just got notified that my rate for the next six months was going back up two dollars lol.
It’s like they are pulling numbers out of a hat.

 

[Intelligent Molecule]

I just had a look at average annual auto insurance costs by state, and it is all over the place. Most expensive is Florida with an average cost of almost $4,000! Vermont was the cheapest at about $1,200.