The average cost of full-coverage car insurance is projected to rise another 7% in 2024.
CAMBRIDGE, Mass., Jan. 11, 2024 /PRNewswire-PRWeb/ -- After a year of rate hikes in 2023, car insurance prices will continue to increase well into 2024 but at a slower pace than last year, according to Insurify's latest Insuring the American Driver report.
Data sourced directly from Insurify, America's top-rated insurance comparison platform, showed the average cost for a full-coverage car insurance policy rose to $2,019 last year — a shocking 24% increase — as insurance companies grappled with profitability amid supply chain issues and climate change.
The report predicts a decrease in the intensity of price hikes in 2024, with a projected 7% increase and abatement in the latter half of the year. "A bit of the pressure is lifting. Drivers can expect some industry stabilization as we enter the second half of 2024," says Betsy Stella, vice president of carrier management and operations at Insurify.
Findings also indicate lower-income states are feeling car insurance price hikes more severely. Out of the top 15 states paying the highest proportion of car insurance premiums relative to income, only four have a median household income over the U.S. average, according to Insurify.
For example, drivers in Mississippi, the lowest-income state in the country, spend 3.4% of their income on car insurance. In comparison, residents of Utah, which has nearly double the median income of Mississippi, spend only 1.8% of their income on car insurance.
The report reveals:
- Following a 24% increase in car insurance costs in 2023, rates will increase an additional 7% in 2024, according to Insurify's latest projections. This is almost double the 4% median year-over-year rate increase.
- Car insurance rates increased 638% more than wages increased in 2023 on average.
- According to Insurify's survey, 62% of Americans reported their car insurance rates increased in 2023, with 22% reporting their rates increased more than once.
- A surprising 45% of drivers surveyed reported they didn't take any steps to reduce their premiums, despite seeing rate increases.
- New York is the state with the most expensive car insurance premiums in the country, with the average full-coverage policy costing $3,374 a year— 67% higher than the national average.
- The average American spends 2.6% of their average income on car insurance, but drivers in over five states, including Kentucky and South Carolina, spend over 4%.
- Increasing deductibles and lowering coverage limits are the most popular ways drivers cut costs.
The report features findings from Insurify's database of more than 97 million car insurance quotes from partnering insurance companies, as well as Insurify's survey of 1,900 drivers across the country.
See Insurify's 2024 Insuring the American Driver report for more insights on car insurance rates and industry trends.
About Insurify
Based in Cambridge, MA, Insurify, America's top-rated virtual insurance agent, provides expert advice and empowers customers to securely compare, buy, and manage their auto and home insurance policies from the largest selection of accurate quotes. With more than 70 million quotes served and $200B in insurance coverage, Insurify has won multiple insurance industry awards, including Forbes NextBillion Dollar Startups of 2022, WPO's 50 Fastest Growing Women-Owned and -Led Companies 2022, Inc.'s 5,000 fastest-growing private companies in America of 2022 and 2021, Forbes Fintech 50 List for 2021 and 2023, Stevies' Gold International Business Award for a Medium-Sized Insurance Company 2021, EY's 2021 New England Entrepreneur of the Year, and Insurtech Insights' Future 50 2021.
For more information, visit www.insurify.com.
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SOURCE Insurify
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