Latest news with #autoinsurance
Yahoo
3 days ago
- Automotive
- Yahoo
How extreme weather is increasing the cost of your auto insurance
According to the Official Data Foundation's analysis of government data, auto insurance premiums have increased 161% since 2008, outpacing general inflation by a wide margin. In the same timeframe, insured losses related to hailstorms — a major driver of auto claims — have increased fivefold in the U.S., costing an estimated $10 billion annually. Research has linked climate change to larger hailstones, which can produce deeper and bigger dents. As the incidence and severity of hailstorms, hurricanes, flooding, and tornadoes increase, insurance providers field more claims and face higher repair costs. These outcomes often prompt premium increases, particularly in areas prone to severe weather. Learn more: The insurance you need to protect your vehicle from flood damage This embedded content is not available in your region. State legislatures regulate insurance rates to prevent excessive charges. The process requires insurance companies to share detailed risk assessments and justify their expected claims and policy-management costs. Weather factors into the risk analysis and projected claims cost, both overall and on an individual policy basis. A rough weather season can cost an insurance company millions in claims across multiple insurance lines, including homeowners insurance, auto insurance, and business insurance. In the third quarter of 2024, insurer Allstate absorbed $1.2 billion of catastrophe losses spread across more than 100,000 claims related to Hurricanes Beryl, Debby, Francine, and Helene. Auto claims related to weather can arise from direct damage and a higher incidence of accidents. Causes of direct damage include: Hail. According to Matt Brannon, data journalist for Insurify, hail-related damages made up 12% of auto claims in 2023, up 9% from 2020. Brannon noted that "hail-related claims are also about 26% more costly to repair than the average repairable claim." Storm surge flooding. High floodwaters can cause extensive damage to a vehicle's electrical system and interior. Mechanical functions can also break down when the water carries dirt and sand into the engine compartment and other systems. Repair costs often exceed the car's value, prompting the insurance company to declare the vehicle a total loss. High winds. High winds from tornadoes, hurricanes, and severe storms can cause downed trees and flying objects that land on vehicles. In extreme cases, wind can pick up vehicles and slam them into buildings or the ground. Indirectly, traffic accidents and collisions are more common in poor weather conditions. Brannon reported that "wet pavement is a factor in 15% of crashes, with snow and sleet a factor in 4% of crashes." Learn more: How much does car insurance increase after an accident? Travis Hodges, managing director of VIU by HUB, a digital insurance platform, also noted the problem of severe storms occurring in areas unaccustomed to them. Drivers who are inexperienced with ice, snow, and wind can be more prone to accidents. Alongside increasingly severe weather events, other factors are pushing the cost of auto repairs higher. Insurance service provider CCC Intelligent Solutions highlights five significant trends affecting auto claim losses in its Crash Course Q1 2025 Report: Aging vehicles. Consumers are delaying new car purchases due to elevated costs and interest rates, plus supply constraints. More EVs and hybrids. EV and hybrids have more expensive parts and higher repair costs. Advanced safety features. Driver assistance features are complex and expensive to repair. Increasing medical costs. Bodily injury claim amounts are on the rise as U.S. healthcare costs escalate. The average bodily injury claim in 2023 was $26,501, up from $20,925 in 2020, according to the Insurance Information Institute. High total loss frequency. Depreciation of used cars and higher repair costs are increasing the frequency of total loss declarations. In short, auto repair costs are rising as older vehicles age and new cars become more complex. Higher healthcare expenses are also increasing auto claim costs. These trends magnify the losses related to hailstorms, hurricanes, and tornadoes, and provide more data to support higher auto insurance premiums. Learn more: Car insurance rates are climbing. Here are 4 reasons why and 11 ways to save. Brannon said drivers in areas prone to severe weather are likely to see the most significant rate increases. He cites Minnesota as an example, where insurance rates increased 58% in 2024. "The state experienced several waves of severe storms, producing heavy rainfall and record-breaking, 6-inch hailstones," Brannon explained. According to the National Oceanic and Atmospheric Administration's National Centers for Environmental Information, the South, Central, and Southeast regions of the U.S. incurred the largest cumulative weather-related damage costs between 1980 and 2024. The three states with the highest weather-related damage costs are Florida, Texas, and Louisiana. Learn more: Experts: Buy more than just the minimum amount of car insurance in Florida These conclusions were based on a review of weather events that each cost more than $1 billion in damage. Tropical cyclones, droughts, severe storms, and inland flooding were identified as the most destructive weather patterns. Learn more: Everything you need to know about car insurance in Texas According to the Bureau of Labor Statistics, the cost of auto insurance in April 2025 was up 6.4% from the prior year. Relative to two years ago, auto insurance premiums are 30% higher. Bannon said inflation and insurer losses are the two main drivers of premium increases. Climate change is a factor because weather influences insurer losses. "Climate change brings more frequent and severe storms that result in more claims and costlier repairs," Bannon explained. "When insurers pay out more in claims," he continued, "they often pass those costs onto policyholders." Hodges agreed. "Unpredictable [weather] events, combined with increases in repair costs and extended repair times, are all fueling the sharp rise in auto insurance premiums." Weather-related damages can lead to claims against your collision, comprehensive, or liability insurance. Comprehensive insurance helps pay to repair your car after a non-collision accident. This includes damage from falling trees, hail, flying objects, and floods. Comprehensive is an optional coverage that requires you to pay a deductible before any claims are paid. Collision insurance funds repair costs for your car when you are at fault in an accident. Weather can lead to a collision claim if heavy rain, wind, or icy conditions contributed to the accident. For example, you may be driving too fast in a storm and lose control on wet pavement. If you hit another car or an object, such as a tree, your collision insurance pays to fix your car. Collision, like comprehensive, is an optional coverage that has a deductible. Liability insurance pays for injuries and property repairs resulting from accidents you cause. Weather can be a contributing factor, but many liability claims are not weather-related. If someone else causes an accident that leaves you with medical bills or repair expenses, that person's liability insurance should absorb those costs. Learn more about bodily injury liability and property damage liability Gap insurance pays off your auto loan if your car is deemed a total loss and the payout is less than your loan balance. Weather can tap your gap insurance if your car is submerged and extensively damaged by a storm surge. Gap insurance is optional coverage, available for newer cars only. There is no deductible. Learn more: Most common types of auto insurance explained Tim Manni edited this article.
Yahoo
29-05-2025
- Automotive
- Yahoo
Louisiana Gov. Jeff Landry signs bills to lower auto insurance rates
BATON ROUGE — Louisiana Gov. Jeff Landry signed a sweeping package of auto insurance reform bills Wednesday, promising to lower the cost of coverage in Louisiana by cracking down on what he calls 'frivolous lawsuits' and strengthening oversight of the insurance industry. Landry called the new auto insurance laws 'the largest tort reform package, and effort made in the history of the state.' He said the goal was to take a measured approach by holding both insurers and litigants accountable for rising costs. The signing came a week after Landry flexed his political muscle and forced one of the key bills through the Senate in a late-night vote. The bill, House Bill 148, gives Insurance Commissioner Tim Temple more authority to reject 'excessive' rate increases — power that Temple says he does not need. Temple has downplayed the idea that Louisiana's high premiums stem from weak regulatory power, instead pointing to legal abuse and a high number of minor injury claims. 'It's a false claim that rates are high because the commissioner doesn't have some magical power,' Temple said. 'The problem in Louisiana is bodily injury claims and the legal system that encourages them.' An amendment added by the governor's supporters also requires insurance companies to make their rate filings public, a move some in the industry say could expose trade secrets. Landry defended the change by pointing out that insurance commissioners in other Southern states, including Texas, Mississippi, Alabama, South Carolina, Florida and others, have the power to reject excessive rate hikes. Budget passes: Louisiana House committee passes budget that closes $200 million shortfall without raising taxes Sports gambling: Louisiana House lowers proposed tax increase on online sports betting TOPS reform:: TOPS tweaks trouble cofounder Taylor: 'Let's not throw the baby out with the bath water' He said HB148 brings Louisiana in line with our neighboring states and gives the Insurance Department more tools to protect consumers. Auto insurance has been one of the most important — and contentious — issues in this spring's legislative session. Political analysts say rising car insurance rates could pose a problem for Landry in a re-election campaign. Landry has repeatedly said he plans to hold Temple accountable if rates do not drop under the new law. In the past, legislators have blamed plaintiff's lawyers and focused almost entirely on tort reform, claiming that caps on big court judgments would bring down auto insurance rates. But premiums have continued to increase, and Landry contended that greater oversight of premium rates is also needed. Landry opened his news conference Wednesday by reflecting on last year's efforts to reform home and property insurance in Louisiana. He acknowledged criticism for not accepting the entire package of legislative proposals at that time and pointed to another Republican governor, Ron DeSantis, who did that in Florida. 'Today Floridians are struggling, and their legislature is trying to roll back some of those recommendations,' Landry said, using the example to explain why Louisiana is taking a more measured path. While Temple expressed skepticism about the need for HB148, he has supported the rest of the package, saying the legal reforms are necessary to stabilize the insurance market and bring rates down. Landry referenced a report commissioned by the Legislature that included tort reform recommendations insurers said would lower rates. 'Still hopeful that by the end of the session, we will sign even more of those industry-specific recommendations that insurance companies asked for, and more importantly predicted, would lower rates,' Landry said. Other bills in the package that the governor signed target who can file lawsuits, how much they can recover and what jurors can consider in injury cases: House Bill 434 raises the minimum threshold of medical costs that uninsured drivers must meet to claim medical expenses in court, from $15,000 to $100,000. House Bill 450 requires plaintiffs to prove their injuries were directly caused by the crash in question. House Bill 431 bars drivers found at least 51% responsible for a crash from collecting any damages. Currently, they can recover damages for the remaining 49%. Landry said business groups have long supported this change. House Bill 436, a controversial measure, prohibits undocumented immigrants injured in car accidents from collecting compensation for general damages. Senate Bill 231 allows jurors to consider the actual amounts paid for medical care, rather than the often-inflated billed amounts, in personal injury cases. House Bill 549 mandates a 5% insurance premium discount for commercial vehicles with dashboard cameras. 'Having undisputed video evidence will reduce litigation, improve truck driver safety, and lower costs for everyone,' Landry said. With bipartisan backing on several of the bills, Landry said the changes mark a major step toward improving Louisiana's insurance climate and restoring fairness in the system. 'Over the last 50 days, the only side I and the legislators who supported this package of bills have been on is the people,' Landry said. 'Our people are too good to be taken advantage of again and again.' This article originally appeared on Lafayette Daily Advertiser: Louisiana Gov. Jeff Landry signs auto insurance reform bills
Yahoo
11-05-2025
- Automotive
- Yahoo
How to file a car insurance claim
From broken windshields to fender benders, there are many reasons you might need to file an auto insurance claim. But sometimes, in a stressful situation, it can be easy to forget the steps you should take to work with your own or another driver's car insurance company. Whether you're looking at minor repairs or extensive damage to your vehicle, here's how to maximize the car insurance claims process. This embedded content is not available in your region. Learn more: How does car insurance work? The basics explained. If you're involved in some sort of accident or car crash that damages your vehicle, you might wonder if you should file an insurance claim, especially if the dents or scratches to your car are minor. Here are a few scenarios when you should consider filing a claim: Someone else hit you, and you're filing a claim against their insurance You caused a crash, and the cost to fix your vehicle is more than your collision deductible Another driver is involved There are injuries Some states have laws that stipulate you must report an accident to the department of motor vehicles if damage is over a certain amount or if there are injuries. If you're replacing a windshield, some states, including Florida, Kentucky, and South Carolina, require your insurance company to waive the deductible if you have comprehensive coverage. Learn more: What to do after a car accident: Your step-by-step guide Whether you're in a fender bender or a serious crash, it's critical to start the claims process quickly. Your first call should be to your own car insurance company. At the very least, your insurer needs to know that you were involved in an accident and that the vehicle they insure has been damaged or totaled. If another driver is responsible for a car accident or causes property damage, such as hitting your fence, the liability insurance portion of their auto policy will pay for your vehicle's damage, other damage to your property, and your injuries, up to their policy limits. Contact the other driver's insurer directly and begin the claims process. If you have a photo of the other driver's insurance ID card, it will often have a claims phone number. If not, you can go to the insurer's website to find the phone number. Learn more: How to file a diminished value claim after an accident The insurer will ask for the other driver's information to pull up the policy, and your information to begin the claim. They might ask for your driver's license number, license plate number, birth date, name, address, contact information, and more. Be cautious when talking with the other driver's car insurance company, especially if you've been injured in the accident. You may be asked to record an official statement about the accident, including how it occurred and what happened afterward. Anything you say in this recording could later be used against you, and you may have trouble getting fairly compensated for an injury that presents itself later on. Even if the other driver's insurer accepts liability, their primary interest may be in controlling costs. Learn more: Is accident forgiveness coverage worth it? You can start a claim on your own insurance by contacting your insurance agent or company. Be prepared with details of how the accident happened, where, and when. If you have details about the other driver's insurance, make sure to provide it. Photos from the scene are also useful. There are several scenarios in which you might make a claim on your own auto insurance: If you have caused an accident with someone else, you can make a claim on your own insurance for your vehicle damage if you have collision insurance. Even if someone else caused the accident, you could choose to make a claim for your vehicle damage on your collision insurance rather than dealing with the other person's insurance company. The downside is that you may have to pay your collision deductible toward repairs, but in these cases, often your insurer will try to get that money back from the at-fault driver's company. In no-fault insurance states, you'll contact your own insurance company to file a claim for your injuries in a car accident, no matter who was at fault. In these states, personal injury protection (PIP) pays for your own injuries, up to a certain threshold. Backed into a telephone pole or sideswiped a mailbox? Even though another driver wasn't involved, you can make an insurance claim on your collision insurance. Learn more: What to know about rental car reimbursement coverage Here's a look at the main car insurance coverage types and who can file a claim on them. Once you have filed a car insurance claim, you'll be assigned a claims adjuster, who will take down relevant information about the accident and keep you updated about the status of payments, your vehicle's repairs, and more. If there are injuries involved, you may be assigned a second insurance adjuster for that portion of the claim. The process of gathering insurance information, understanding policy details like your car insurance deductible, and waiting for repairs can be stressful, especially if you're responsible for an accident. But it's important to cooperate with the insurance company's investigation. This will allow things to move along as quickly as possible, so that vehicles can be repaired and claims paid out within a reasonable amount of time. The time it takes to process an insurance claim typically depends on the complexity of determining fault and the severity of the damage and injuries. For minor accidents and vehicle damage, you may be able to wrap up the claims process in a few days. For more extensive damage or severe accidents, it could take weeks to months for a resolution. Some state laws specify that an insurance company has 30 days to investigate a claim, but if lawyers are involved or the case is complex, expect several weeks or months. If your car insurance claim is denied, review the denial letter carefully to understand why your claim was denied and what recourse you might have. Take a close look at your policy. Did you have coverage for the claim? If you think the denial is unjustified, you can submit an appeal. If your appeal is denied and you still feel the claim should have been paid, you can contact your state's department of insurance, which may be able to help negotiate a resolution. If you think your insurer violated state law, you can consider making a complaint with the state insurance department. If you have a complicated claim, fault is unclear, or your claim has been denied, you might consider hiring an attorney. Consultations are generally free of charge and can give you an idea of your options, especially if your case is complex. Your insurance rates will likely go up at renewal time if you were at fault in an accident. You can avoid a rate increase if you have accident forgiveness insurance. Under these programs, one accident won't cause your rates to go up. Sometimes you'll pay extra for this feature, and with some companies, you can earn it for free. Learn more: How much does car insurance increase after an accident? If you're at fault in an accident with another driver, the choice about whether or not to file a claim will be up to the other driver. However, if you're the only driver involved, it may not make sense to file a claim, especially if the cost to repair your vehicle is less than your collision deductible and the subsequent rate increase you could face for filing the claim. Having second thoughts or finding the repair costs were less costly than you thought? You can cancel a car insurance claim, provided you're the one who filed the claim. You cannot cancel a claim another driver makes, either with their insurance or yours. Amy Danise and Tim Manni edited this article.
CBC
06-05-2025
- Automotive
- CBC
Many Albertans 'skeptical' of proposed insurance reform: Nanos poll
Social Sharing The province's proposed auto insurance reforms come with the promise of reduced rates, but a recent survey suggests not all Albertans are convinced. Only one in five Albertans considers a reduction in auto insurance premiums to be likely if the Alberta government moves forward with a "no-fault" insurance system, according to a study released by Nanos Research on Tuesday. Expected to take effect at the start of 2027, the legislation aims to provide drivers injured in collisions with access to medical treatment and income support rather than having claims taken to court. The province's goal with these changes is to reduce the time and money spent on litigation, which in turn would result in lower auto insurance rates. This care-first system would provide better, faster and cheaper care for Albertans, who will see up to $400 in yearly savings, according to the Ministry of Treasury Board and Finance. Forty-seven per cent of Albertans consider such a reduction in auto insurance premiums "unlikely" compared with only 19 per cent who consider it "likely" to happen, according to the Nanos poll. "Albertans are sending a clear message: People want fairness, accountability, and the ability to seek justice when they're harmed," said Nik Nanos, chief data scientist at Nanos Research, in a media release. "They are skeptical that the proposed changes will lower their premiums." The poll, which surveyed 1,087 Albertans between March 24 and April 1, suggests that the province's auto insurance system "is not a pressing issue for Albertans," with 52 per cent saying it's not urgent. When compared with other issues like health care, cost of living, education and affordable housing, less than one per cent of respondents cited auto insurance as a top priority. The insurance reform legislation was put forward by Finance Minister Nate Horner as Bill 47, or the Automobile Insurance Act, on March 24, after first being announced by the province last fall. New bill would launch Alberta's overhaul of auto insurance 1 month ago Duration 1:58 The provincial government has introduced legislation that would change Alberta's auto insurance system. Bill 47 is what the government describes as a "care-first" system, where the majority of injury claims are settled without going to court. Emily Fitzpatrick has more. When asked about the findings of the study, Horner said the legislation will ultimately benefit Albertans, who on average pay the second-highest auto insurance rates in Canada. "I guess we better show 'em the savings are real," he said. This year, the auto insurance rate cap for good drivers was raised to 7.5 per cent, with the province saying the increase accounts for higher costs related to legal matters, vehicle damage repairs and natural disasters. Nanos cited a June 2024 survey commissioned by the province, which found that 73 per cent of respondents agree that having the ability to sue at-fault drivers is an important element of ensuring accountability, complementing the pollster's own finding that over four in five Albertans emphasize the importance of holding people legally and financially accountable. When asked to choose between lower auto insurance premiums and having the right to sue, 48 per cent of respondents said the former was more important, while 38 per cent chose the latter. While the legislation will limit the extent to which claimants can take at-fault drivers to court, Horner clarified that litigation will still be an option when appropriate. "There will be tort options within this system for egregious, serious offences," he said. Details of insurance reform not yet ironed out Under the new legislation, most injury claims will no longer be settled in court. Lawsuits can be filed when the at-fault driver has been convicted of a serious driving offence, with those specific offences yet to be defined. Claimants will also be able to sue for out-of-pocket expenses outside of the coverage of their insurance policy, and will have the right to appeal decisions made by their insurer regarding those benefits. With many details left undefined, the current legislation is simply a framework expected to be fleshed out later this year, said Aaron Sutherland, a vice-president with the Insurance Bureau of Canada. "Until we see the details from the province of exactly how large this window of court access is going to be, we don't know the cost associated," said Sutherland. "But one thing we do know: the more lawyers are involved, the less drivers are going to save." How does Alberta's current insurance system compare to other provinces 6 months ago Duration 1:56 On average, Albertans pay the second-most expensive auto insurance in Canada, behind Ontario. The province will move to a new system in 2027 with the intention to make it more affordable, eventually. CBC's Travis McEwan looks at how Alberta's current system compares to the rest of Canada. The study was commissioned by the Alberta branch of the Canadian Bar Association, representing 5,500 lawyers and members of the legal profession. A report commissioned by the province and released April 2024 suggested switching to a no-fault system could result in the loss of 650 to 800 jobs in the legal field, stemming from the elimination of the vast majority of accident compensation legal cases. Potential savings on auto insurance will be determined by the details of the finalized legislation, including the extent of the ability to sue, and factors such as the state of Canada's auto sector, which is affected by uncertainty due to tariffs imposed by U.S. President Donald Trump. "The longer these tariffs remain, and if we do see further tariff action by the United States and reciprocated by Canada in the auto sector, that is going to have an impact on the price drivers are paying for their insurance moving forward," said Sutherland. Economic factors aside, whether policyholders will actually save on auto insurance depends on the balance that the province strikes between the amount of care provided by the new system and the legal costs and cases remaining in the system. "The province is talking about having the greatest ability to sue of all care-based systems in Canada, but there is going to be a cost associated with that," said Sutherland. Similar systems in Saskatchewan, British Columbia and Manitoba "don't allow nearly the ability to sue that Alberta is currently exploring," he said. Unlike those provinces, which have public providers for mandatory auto insurance, Alberta is sticking to private insurance companies under the new system. The province stated that a public insurer would cost nearly $3 billion to establish and millions to operate annually, making private delivery more financially viable for taxpayers. Eighteen per cent of survey respondents said they trust the provincial government to oversee a no-fault insurance system with private insurance companies "prioritizing victims over profits." Forty-six per cent said they do not trust the province to do so, with 48 per cent disagreeing with the notion that the government would ensure fair payouts for those unable to take their claims to court. The poll's probability sample of 1,087 respondents has a margin of error of ± 3.0 percentage points, 19 times out of 20, according to Nanos Research.
