If you haven’t given much thought about how much you’re paying for car insurance, now might be time for a fresh start.
The Consumer Price Index (CPI) shows car insurance rates have gone up 20% nationwide.
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In the past year alone, auto insurance rates in Massachusetts increased by $43 per year. That’s according to The Zebra, a company that tracks and compares insurance rates.
Kevin Brasler is the executive editor of Boston Consumers’ Checkbook.
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“For a few years the auto insurance rates, they held steady, especially during the pandemic. Now, people are driving more, rates of accidents are going up, and when there are accidents, there's property damage -- it's more expensive to repair the cars.”
He believes most drivers stick with the same insurance company for years because they think most companies charge the same prices.
“They think, ‘oh, I’ve been a good driver’ or ‘I haven't had tickets,’ ‘I haven't had any claims or accidents,’ therefore I’m probably getting the best price from this company that I’ve been with for a long time. And that is not true,” said Brasler. “We find that most drivers, just by shopping around for a better rate, can save $500 a year and many will save $1,000 or more.”
Because insurance rates have gone up so much, Brasler notes some drivers are dropping their liability limits to make their policy more affordable.
“If you injure someone in an accident, you need to maintain adequate coverage there. And for most of us, we need the policy limits about $300,000 for that.”
He recommends dropping collision and comprehensive coverage when your car’s value drops below $5,000. Drivers should re-evaluate their coverage when their current policy is set to expire.
“There's no reason to wait. You can shop around. You can find a better price elsewhere. You can switch your coverage to that new company,” said Brasler. “When you cancel with your old company, it -- by law -- has to refund you the unused share of premiums that you've paid.”
When asked about any relief for drivers in the near future, Brasler said don’t count on it.
“The good news is they're the cars that are being built are safer than ever. But, you know, there are still injuries resulting in accidents. It's hard to predict.”
Carefully consider the extras on your policy. Some optional coverages aren’t worth much, but companies charge a lot for them.
Drivers looking to switch companies can check out Consumers' Checkbook's auto insurance comparison tool.
