Insurance.com Study: Auto Insurance Rates Continue to Climb

By Rstaib Posted : 07/17/2008

Low Mileage Discounts May Help as Consumers Scale Back Commutes

CLEVELAND, OH - July 17, 2008 - Auto insurance rates continued to rise for the second quarter this year, according to a study by Insurance.com, the largest online auto insurance agency in the United States.

Insurance.com's quarterly Car Insurance Rate Report found that the lowest car insurance quotes, on average, increased 3.4% over the previous quarter, rising from $1,831 per year to $1,893 per year. The rate report is based on real-time auto insurance quotes given to consumers from more than a dozen insurance companies during the second quarter. It marks the second consecutive quarter of rate increases, following last quarter's 1% increase, reversing the trend of steady or falling auto rates for the past several years.

"Our quarterly rate report is a leading indicator of where auto insurance rates are heading," said Dave Roush, CEO of Insurance.com. "Car insurance companies are continuing to raise prices due to rising medical costs and the rising cost of repairing vehicles. We believe rates will continue to increase through 2009 as carriers adjust their rates to compensate for these costs."

Car insurance rates vary by state, and some states experienced rate quote increases in the second quarter that were greater than the average. Indiana and Texas, for example, saw rates jump 6.7% and 4.3%, respectively.

Individual states, companies or industry groups might report annualized increases that are still quite small, as their data reflects the past 12 months, when rates were falling or holding steady. The Insurance.com data, however, is real-time, representing the real-world experience of consumers who have gotten an online or phone quote for auto insurance in the last three months.

"Now, more than ever, consumers should compare car insurance rates before they renew their policies," added Roush. "If they comparison shop and follow some simple strategies, they may realize hundreds of dollars in savings with a new company."

Additional Findings

  • The most expensive auto insurance quotes were in Louisiana ($2,577), New Jersey ($2,544) and Washington, DC ($2,466).
  • Among the top 10 states seeing the sharpest increase in car insurance rates in the 2nd Quarter were Indiana (up 6.7%), Arkansas (up 6.1%), Texas (up 4.3%), Nevada (up 4.1%) and Illinois (up 3.8%).
  • The least expensive states for auto quotes in the second quarter included Ohio ($1,268), Wisconsin ($1,276) and Maine ($1,285).

Money Saving Tips
Insurance.com offers these tips for consumers:

Low Mileage Discount
Many drivers are considering telecommuting, car pooling or taking public transportation a few times a week to save money. Be sure to notify your insurance company of any change in driving habits. Driving less could save you additional money on premiums. Many companies offer a "low mileage" discount if you drive less than 10,000 miles each year.

Don't Over-Insure Your Car
Money's tight, so many consumers are hanging on to their older cars. If that's your situation, reconsider Comprehensive and Collision coverage - it may not be cost effective. Insurance only pays for your car's actual cash value (or fair market value), so Comp and Collision may not be worth keeping on an older car that has depreciated considerably.

Be a Smart Online Shopper
Comparison shopping online can save you time and money. Just make sure you understand whether you're getting a "quick quote," which is just an estimate, or a bindable online auto insurance quote. There can be a big difference between an estimate and the final rate. Insurance.com provides consumers with real-time accurate and bindable auto insurance quotes from over a dozen leading insurance companies, and the ability to buy a policy quickly online.

ABOUT THE CAR INSURANCE RATE REPORT
Insurance.com's latest Car Insurance Rate Report highlights the lowest average car insurance rates quoted to consumers visiting Insurance.com in the second quarter of 2008. The rates consumers viewed, but didn't necessarily purchase, come from auto insurance quotes consumers received as they shopped and compared rates from over a dozen of the nation's leading auto insurance companies. Over the course of a year, Insurance.com provides online car insurance quotes to more than 1 million people visiting the website. While the Car Insurance Rate Report is a broad indicator of pricing activity in the personal auto insurance marketplace, it is not a comprehensive index as it reflects only the quotes of carriers that have participated in the Insurance.com platform in the states where it quotes (all states except Alaska, Hawaii, and Massachusetts). See the entire report at www.insurance.com.

ABOUT INSURANCE.COM
Insurance.com is the leading online independent auto insurance agency in the United States. Consumers can instantly compare quotes from top auto insurance companies by completing one application at our website, www.insurance.com. To buy a policy, consumers have the option to complete the transaction online or speak with a licensed agent. Our innovative technology links directly to the rating systems at 15 major insurance companies, streamlining the shopping process for consumers and enabling companies to attract new customers through real-time underwriting and quoting.

In addition to providing comparative quotes at Insurance.com, the company provides white label auto insurance solutions to financial institutions, affinity groups and online marketplaces. Other products include life, health and home insurance as well as travel, dental and pet health insurance. Founded in 2000, Insurance.com is based in Solon, Ohio.

Media Contacts:
Sari Martin/Susan Hartzell
ICR
Sari.martin@icrinc.com, 203-682-8345
Susan.hartzell@icrinc.com, 203-682-8238

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