Auto insurance rates are falling by an average of 1.7 percent across the country, with drivers in Michigan, Ohio, Kentucky, Arkansas and Louisiana seeing the biggest declines of more than 4 percent.
According to ValuePenguin.com, this is the first time the percentage has fallen nationwide in more than a decade State of car insurance in 2021 report, which found the average cost of auto insurance to be $ 1,636 in 2021.
The report says the tariff cuts in 2021 are due to fewer Americans driving in 2020 and fewer claims from the COVID-19 pandemic.
The analysis shows that there are a handful of states where rates do not drop on average: Florida, Rhode Island, New York, Massachusetts, Wyoming and Indiana.
ValuePenguin also predicts that rates are likely to start rising again in 2022 as more Americans return to normal and claims increase due to distracted driving and the cost of smart technology in vehicles.
Analysts at ValuePenguin.com (a website for advice on consumer financial products and part of LendingTree.com) analyzed 15 million car insurance quotes for drivers across the country from Quadrant Information Services' database. They used these, combined with RateWatch filings, to illustrate the current and historical record. The analysts used a 30-year-old man driving a 2015 Honda Civic EX as an example driver for this analysis, and quotes were drawn from all available zip codes in the United States.
Sterling Price, an auto insurance analyst at ValuePenguin.com, said the report seeks to debunk some of the main problems behind auto insurance costs and discover ways Americans can save more money. He said premiums can vary by up to 242% with the largest insurance companies and consumers can save by shopping around and comparing quotes and ad coverage.
• The largest year-on-year auto insurance declines are in Arkansas (4.8%), Ohio (4.3%) and Michigan (4.3%). Five states will see marginal increases, including New York at 1.2% and Indiana at 1.1%, despite a drop in the national average.
• The average cost of auto insurance in 2021 is $ 1,636: Drivers living in Maine, North Carolina and Indiana have the lowest auto insurance rates – 40% cheaper than the national average. However, Michigan auto insurance rates held their spot as the most expensive and are 353% higher than the national average. Florida and Rhode Island are the second and third most expensive.
• A traffic violation will lead to an average premium increase of 117% by 2021: North Carolina drivers will see the largest premium increase (255%) from a traffic violation. Florida auto insurance companies are the most forgiving, raising premiums by only 55% on average. Individuals with DUI violations will see their premiums increase by an average of 157% in 2021, and for minor violations, such as disobeying road signs, insurance premiums will increase by 28%.
• Premiums for car insurance are 106% more expensive compared to ten years ago. Although auto insurance premiums fell for the first time in a decade in 2021, rates are significantly higher than what Americans paid a decade ago, and rates have increased every year since 2011.
Source: State of car insurance in 2021.
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