Insurance rates rebound in 2022; why this is costing drivers more

Published: Jan. 21, 2022 at 10:15 AM CST
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HUNTSVILLE, Ala. (WAFF) - No matter your insurance company, rates are increasing across the board. There are a lot of factors that play into this, but some ways to work around it.

“While every insurance company has their own logarithm for calculating rates, the costs are going up for pretty much every insurance company,” said Clay Ingram, Public Relations and Marketing Manager for AAA Alabama.

Ingram says if you look at the trends, you’ll have a better understanding of price fluctuations. For example, during the heart of the pandemic, there were significantly fewer drivers on the road. Accidents were down and as a result, insurance companies’ costs were down. Two years later, rates are rebounding from the big drop we saw in 2020.

“A lot of insurance companies actually sent rebates out to their insurers, including AAA,” Ingram said. “We actually sent three different ones out to the people insured with us during 2020 to kind of offset that savings for the motorists out there.”

Another reason we are seeing high insurance rates today is because of rising costs. The cost of nearly every product has gone up noticeably over the past few years. That means, if you happen to crash your car, it’s going to cost much more to get it repaired.

“Those costs have gone up over the last two years so that is part of the equation for every insurance company out there,” Ingram said.

Ingram says there are discounts out there, but drivers need to take initiative. Most people aren’t aware of the discounts they qualify for.

“Talk to your agent and ask if there are any discounts available that you aren’t taking advantage of,” Ingram said. “If you have school-aged teenagers that are driving that are on your insurance policy...and that is usually a pretty big expense for most people…A lot of insurance companies give discounts for good grades and things like that.”

Having fewer claims on your own personal insurance is another way to keep your rates down. Ingram also notes, a reduction in the number of crashes in general will help get everybody’s rates down.

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