INSURANCE RATES
Car insurance rates continue to increase, but not as fast as last year, according to a report by the Insurance Information Institute (III). A decline in the number of accidents and crackdowns on fraud are slowing the rate of increases in auto insurance rates.
The cost of car insurance is expected to rise by 3.5 percent in 2004 compared with an increase of 7.8 percent in 2003.
In addition to reductions in accidents, improving financial situations at insurance companies are helping to keep rate increases below last year's levels.
However, according to the III survey, rising auto theft rates in some states will keep costs higher, particularly in Florida, Massachusetts and New York. Another reason rates keep increasing, even if at a slower pace, is the growing cost of medical care. According to the III, typical costs for treating au auto accident victim range from $6,000 to $9,000, although in some cases those costs rise into the tens of thousands of dollars.
The study also blames the increasing cost of collision repair as part of the insurance cost escalation. "Unfortunately, while drivers today are filing fewer claims, those that are filed cost more," said Robert Hartwig, senior vice president and chief economist of the III in a press release.
[Author Affiliation]
By Mark Johnson
Senior Editor
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