Auto, Home Insurance Rates Rose in Many States Last Year

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  • In the past few years, insurance rates have largely gone up nationwide, and consumers have continued to hang on to their essential coverage types. However, new data shows that these increases might be prompting many to start shopping around for more affordable coverage, and insurance agents in certain areas might find this problem exacerbated by particularly large upticks in premiums over the course of this year.

    On a national basis, auto insurance rates ended the year up 2.5 percent in 2013, while those for home coverage spiked 5.1 percent, according to a report from the Insurance Journal based on data from Perr and Knight’s latest RateWatch. Of course, those types of increases weren’t uniform across the country, and some states saw huge increases in costs for the same coverage they’ve always had.

    For instance, Oklahoma was hit with an average 12.1 percent increase in homeowners insurance policies, with Florida and Kentucky not far behind at 11 percent and 10.9 percent, respectively, the report said. Kansas (10.3 percent) and North Carolina (10.1 percent) rounded out the top five. Meanwhile, only two states saw drops in these costs: California and Hawaii. For the former, the decline came to 3.4 percent, and the latter’s was far more marginal at 0.7 percent.

    Auto rates continue to rise in already-troubled areas
    Meanwhile, states that are currently plagued by high auto insurance rates saw their costs continue to rise last year, the report said. Michigan, for example, suffered the largest increase in the country, at 8.6 percent, compared with the national average over the last five years of between 2 percent and 4 percent. Georgia’s hike in 2013 came to 5.2 percent, while New York and Delaware were tied at 4.3 percent increases. Finally, Nevada’s was at 4.1 percent. At the same time, no state in the entire country had premiums drop, but North Dakota at least saw them remain flat. At the same time, it should be noted that this year’s average national increase was down from that of the 3.7 percent rate hike seen in 2012.

    Insurance agents will certainly have their work cut out for them over the next few years when it comes to retaining clients, because many may still be motivated to go looking for the best deals available to them if prices continue to rise. If this is the case, highlighting other aspects of coverage, including the quality of customer service, might be a good way to keep some of these clients around.