According to a new report from AssureThe report forecasts a total increase of 22% by the end of 2024, increasing the average annual comprehensive insurance premium from $2,329 to $2,469.
This increase in premiums is a continuation of last year’s trend, which saw significant increases due to record-high underwriting losses, totaling $33.1 billion in 2022. The report attributes these rising costs to several factors, including a rise in weather-related claims, inflated prices for new cars, and rising repair costs, particularly for vehicles with advanced driver assistance systems (ADAS) and electric vehicles.
The report found that there was a 56% increase in weather events causing billion-dollar damage between 2019 and 2023 compared to the previous decade. Hailstorms alone can cause an average of $5,000 in damage, with some storms causing over $130 million in damage.
In addition to weather-related damage, the complexity and cost of repairing newer vehicles also drives up insurance premiums. Vehicles with ADAS features can increase overall repair costs by as much as 37.6%, while electric vehicles are 46.9% more expensive to repair than gasoline-powered vehicles, with the average repair cost being $6,700. The report also highlights that electric vehicles take an average of 5.8 days longer to repair.
The impact of these rising costs is felt most in six states where average annual premiums have exceeded $3,000: Florida, Louisiana, Maryland, Nevada, New York and South Carolina. In these states, premiums are at least 15% higher than the national average. At the other end of the spectrum is New Hampshire, at $1,000, with the lowest average premium.
The report also points to significant premium increases in several states, with Minnesota leading the way with a 55% increase, closely followed by Missouri (51%), North Carolina (46%), Illinois (46%) and California (45%). Auto theft rates have also contributed to premium spikes, with California, Illinois and Missouri among the states with the highest vehicle theft rates in 2023.
