Why Auto Insurance Rates are Increasing

In recent years, the prevalence of smartphones and other electronic devices has significantly increased distracted driving. Drivers are more likely to text, make calls, check social media, and engage in other activities while behind the wheel, diverting their attention from the road. This dangerous behavior results in a higher number of accidents, making the roads riskier for everyone.

As urban areas continue to grow, traffic congestion becomes a major issue. Heavier traffic often leads to more accidents, and accidents in crowded areas are more likely to be severe due to the higher speeds at which they occur. This congestion is further exacerbated by a booming gig economy, leading to more delivery and ride-sharing vehicles on the road.

Despite numerous campaigns and strict laws against impaired driving, drunk and drugged driving continues to be a major cause of accidents. These accidents are often more severe because impaired drivers have slower reaction times and impaired judgment.

The increase in accident frequency and severity directly affects insurance companies’ payouts for medical bills, vehicle repairs, and property damage. In turn, this leads to higher costs for insurers, which are then passed on to policyholders in the form of increased premiums.