6 reasons you're to blame for California's auto insurance rate increase
Feb. 12--I'm not sure I need to tell you this, but your auto insurance bill is getting larger.
The cost of a typical California policy has risen by 6.3 percent in the past year -- the nation's No. 2 jump -- part of the five-year rise totaling 44 percent and No. 7 among the states.
Will it make you feel any better if you knew that this typical insurance bill -- $1,713 for a 30-year-old male driving a 2013 Honda Civic -- is only the ninth-highest in the nation, according to a study by The Zebra online insurance tracker? (Most expensive: Michigan, at $2,610. Cheapest? North Carolina, at $865!)
Look, auto insurance rates are up across the nation. The typical $1,427 policy grew by 2 percent in 2017 and is up 20 percent from 2011.
And there's a pretty good reason for it. Insurers are trying to fill a financial hole they created, in good part, by not charging enough previously. Industry tracker A.M. Best estimates U.S. insurers lost $36 billion in the past two years on all property/casualty policies.
No, this isn't totally corporate greed. Insurers' desires to make a profit insuring people is part of the logic behind the rate hikes. The industry is getting financially hammered by a growing number of accidents creating record losses for many insurers.
Yes, you are part of the problem. Six ways to blame YOU ...
1. You're working! Congrats on the new gig. But more jobs, more commuting, more chances for accidents.
2. You're thrifty! Cheaper gasoline (remember when it was $4 plus) makes driving more affordable. So do all those super-efficient "green" vehicles. Again, more driving.
3. You're distracted! If it isn't the latte or burger juices spilling ... it's your smartphone or the high-tech displays that are taking your eyes off the road. Even more chances for accidents.
4. You're buying fancy cars! All those new gadgets supposedly make you safer. Unfortunately, they're also pricier to fix when your extra driving leads to extra accidents.
5. You're costlier to fix! Car crashes mean your auto insurer picks up the tab for medical bills. And if you haven't heard, it's more expensive to be cured ... much more expensive.
6. You're paying for climate change! You know all those unusual natural disasters? Fires in California, hurricanes, snow and floods elsewhere? Guess who eventually pays to replace all those vehicles?
And The Zebra's report shows how much your mistakes will cost you in average premium increases: A ticket for not wearing a seatbelt ups your policy cost by 4 percent; speeding (6-to-20 miles per hour over the limit), a 21 percent hike; at-fault accident, a 40 percent hike; caught driving-under-the-influence, a 77 percent hike; and guilty of hit-and-run, an 85 percent hike.
I don't want to sound too much like a dad, but please be safe out there. Not just for your life and your limbs.
Collectively, safer driving would save all of our family checkbooks.
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