What car insurance company has raised rates the most?
Consumer Affairs / Mark Huffman 02/22/2024
Their TV commercials can be clever and funny, but car insurance customers aren’t laughing when they get the bill.
Car insurance premiums have sharply increased since 2022 as underwriters say they are having to pay for more accidents and increasingly expensive auto repairs. But what company has increased rates the most?
According to some industry sources, that title may belong to Allstate, which this month decided to resume covering cars and trucks in California after suspending coverage. But renewed coverage comes with much higher premiums, with the average rate rising by 30%.
Allstate negotiated the double-digit rate increase with state regulators, saying it needed that much to resume direct sales of auto insurance in the state.
Geico has increased its car insurance rates in California, but not as much, with the average premium rising by 12.8% in California. Geico and Allstate were the insurance companies that hiked rates the most in 2022.
The increase is part of a broader trend where insurance companies are raising rates due to various factors, including inflation, increased costs associated with car repairs, and a rise in accidents and insurance claims.
The sudden increase in premiums leaves a lot of consumers, like Jari, a Progressive policyholder from Columbus, Ga., very confused.
“I have had a perfect driving record for the past 12 years,” Jari wrote in a ConsumerAffairs review. “Instead of my monthly payments dropping over time, they are instead rising, at an average of $12.00 per year, each year. When I lived in Massachusetts my rates would decrease each year that I had no tickets or accidents. I am VERY unhappy with this company.”
Up double-digits across the board
But alas, it’s not just Progressive. Insurance Journal has reported that Farmers Insurance instituted double-digit rate increases in 43 states in 2023 for a weighted average rate increase of 17.6%. In fact, all 10 of the major U.S. insurance companies raised their rates by double-digits last year.
According to S&P Global Market Intelligence’s RateWatch, Farmers hiked rates by 34.7% during 2022 and 2023. On the low end of the scale, Progressive premiums rose a relatively modest 22.8%.
These are all averages, of course. Other factors play a role in what policyholders pay, including the type of vehicle, age, driving record, and in some cases Zip Code and credit score.
In Nevada, for example, the sharp increase in rates is due to the increase in the number and severity of crashes, particularly in Clark County.
While all insurers are raising their premiums for auto coverage, it still pays to shop around for the best rate. Make sure you are comparing the same type of coverage but consider making changes, such as raising the deductible, to lower the cost.
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