Social inflation, like people's propensity to file or litigate claims, has been climbing, according to the Insurance Information Institute (III). That inflation also includes rising costs for labor, auto parts, medical care if someone is injured, and new and used car prices, all of which have contributed to increased insurance prices. Economic inflation of the kind everyone’s been talking about the past few years, including rising costs of groceries, smartphones and tires. What you pay in auto insurance varies from person to person, depending on location, type of car and a person’s age and driving record.īut there are a few things that factor into everyone’s price increases. Senior savings: 10 Tips to save on senior car insurance Why is auto insurance getting so expensive? And for people living on fixed incomes, "it may soon be impossible to pay for car insurance.”ĭouble trouble for consumers: A double whammy for consumers: Home and auto insurance rates are set to jump in tandem She said the impact of higher auto insurance costs spans upper- and lower-income households. “Many consumers have little to spare in their budgets to pay more for household goods and auto insurance,” said Aliza Vigderman, content director at. Eleven percent of drivers now pay more for car insurance than car payments, and 7% spend more on insurance than household utilities, a report from insurance platform shows. The rising insurance costs come as consumers are struggling financially after nearly three years of high inflation and surging car prices. rates are expected to rise by an additional 8.4% in 2023, which would outpace current inflation at 4.9%, and represent the largest increase in six years, according to consumer research and finance site ValuePenguin. 
If you think the cost of a car has gotten expensive, wait until you go to insure it.Īuto insurance rates are up nearly 15% in some states over the past year, while nationwide premiums have risen more than $240 on average to $2,014 a year, according to comparison site Bankrate.
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