Personal auto insurance rates are expected to see an average increase of around 12.6% during the coming year, according to ValuePenguin.com, which pegs the increase on growing repair costs and severe weather events. "It's another year of sticker shock for auto insurance policyholders," says Divya Sangameshwar, insurance expert and spokesperson for ValuePenguin. "Last year insurers raised their premiums by 11.3%. And that is just the average rate that insurers raised, so your actual premium hike would have been higher depending on your driving profile and other factors." She adds that a U.S. Census Bureau survey of American drivers reported average increases closer to 19%. While auto rates tumbled during the pandemic, as fewer people were driving, premiums are now about 29% above where they were before COVID-19, Sangameshwar says, noting that inflation is one of the biggest drivers of this increase. She explains that factors such as inflation have a delayed effect on auto rates because rates for this year will be based on the previous year's claims. Growing repair and replacement costs are also pushing auto rates higher. Although nearly every state is expected to see average auto rates increase, some areas are seeing rates growing at a much slower pace. Sangameshwar says this is due to the negotiation between insurance companies and state regulators as well as the number of claims and claims costs for that particular state. For example, Idaho is expected to see rates only grow around 4%, on average, this year. Sangameshwar explains this is likely due to the state being largely rural. Areas with less dense populations tend to see fewer accidents when compared with heavier populated states such as Nevada, where rates are expected to grow around 28% in the year ahead. The above slideshow ranks the states with the slowest growing personal auto insurance rates from 2023-2024, based on data from ValuePenguin.com. The slides also include data on auto rate changes for 2018-2024. Related: |

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