DAYTON — While the cost of vehicles in the US dropped about 10% the price of maintaining that car could be nearly $11,000 annually, according to AAA. A big part of that dollar amount is auto insurance.
According to News Center 7 Consumer Advisor Clark Howard, the way we drive is a big reason why insurance is so expensive. The average premium is more than $2,000 a year, according to bankrate.com
“I was shocked! How can they go up that high?” Asked driver Edona James. The yearly premium for her Ford Focus shot up to nearly $3,600 after a fender bender in a parking lot. “On a car that is not even halfway new? It’s just 2013. I don’t understand that concept.”
>> More I-Team/Clark Howard content
Ronald Jackson with American Property Casualty Insurance Association said claims like the one filed in James’ case are a big reason for rising premiums. “The cost to repair a vehicle, the cost to replace the vehicle, be it a new or used car, the cost of medical care... all those factors have increased greatly over the last couple of years when insurance companies are paying those claims when an accident occurs,” Jackson said.
Clark suggested asking auto insurance companies for discounts because of a good driving record, bundling with renters’ insurance, and vehicle safety features. Also, consider choosing a higher deductible. According to the Insurance Information Institute, an increase from $200 to $500 could bring your collision and comprehensive cost down 15 to 30%.
Clark also said don’t get too comfortable with an insurance company. They often reward loyalty with rate hikes. He said drivers need to shop around for auto insurance, and annually check for better rates.
© 2023 Cox Media Group