Car insurance rates to increase in 2023, survey says: Here's how you can save
Auto insurance costs are forecasted to rise by another 7% in 2023
U.S. drivers are facing another year of high auto insurance rates, a recent Insurify survey said.
American drivers could face another year of rising auto insurance costs in 2023, as inflation and increasing claims drive premiums to a new high, a recent report showed.
Due to rising inflation and traffic accident rates, drivers saw auto insurance costs increase by 9%, to $1,777 per year in 2022, according to Insurify's 2022 in review and what's ahead for 2023 report.
Auto insurance costs could rise by another 7% in 2023 to $1,895 per year, the report forecasted. Inflation and the continued rising cost of vehicles coupled with consumers driving more will drive the spike in insurance rates next year, Dan Roccato, professor of finance at the University of San Diego School of Business, said.
"It's hard to see how this changes until we fix our inflation problem," Roccato continued.
However, drivers could see some relief from high insurance costs toward the end of 2023.
"The general consensus is that it will be eight to 12 months [from fall 2022] before rate increases begin to slow down, and some think it could be several years before prices fully stabilize," Betsy Stella, vice president of insurance partnerships at Insurify, said.
If you are looking to save money on your car costs, you could consider changing your auto insurance provider to get a lower monthly rate. You can visit Credible to shop around and find your personalized premium without affecting your credit score.
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These states pay the most for car insurance
Oregon, Maryland and Virginia saw auto insurance rates rise by 25% in 2022, according to the report. And while Michigan drivers saw their rate increase by just 1%, they still paid, on average, $2,895 for coverage in 2022, $1,188 more than the average American.
In some instances, drivers said they saw rates increase more than once over the past year. Nearly half 28% said rates increased at least one time and 19% said they saw it increase multiple times.
One insurance rate expert said that in 2023 car insurance rates could feel some additional impact from climate change.
"If climate- and weather-related auto insurance claims increase, insurers will likely hike rates," Laura Adams, an award-Winning financial author, podcaster and spokesperson, said. "When insurance becomes less affordable, more consumers may risk driving with too little or no coverage."
If you are shopping around for new auto insurance, you can use the Credible marketplace to compare multiple providers and find your personalized rate in minutes without affecting your credit score.
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Tips for lowering your insurance rate
American drivers may face another year of expensive auto costs driven by high price tags for cars, increasing insurance costs and climate-related claims increases, according to the report. Here are some ways insurance experts recommended that drivers could save on costs:
Choosing an economical car can make a difference in what drivers spend, according to Roccato.
"So 'boring is better' when it comes to saving money on auto insurance," Roccato said. "Your heart wants a new convertible; your wallet is happier with an older sedan."
Drivers can also compare quotes from at least four to five companies before picking a policy and reevaluate their policy every six months to make sure it still covers their needs, according to Adams.
"The best way for drivers to manage higher auto insurance premiums is by shopping and comparing quotes at least annually," Adams said.
If you are struggling with rising prices and want to save money, you could consider finding a new auto insurance provider to lower your monthly premium. Visit Credible to compare multiple car insurance providers at once and choose the one with the best rate for you.
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