Tag: anything auto

As car prices moderate from a pandemic-era surge, insurance has pushed the cost of car ownership to the brink for many Americans.

New data out this week showed auto insurance costs rose 20.6% from the previous year in February, matching January’s increase as the most since December 1976, when costs rose 22.4% over the previous year.

On an annual basis, motor vehicle insurance costs rose 17.4% in 2023, the most since a 28.7% increase in 1976, according to data from the BLS.

The sticker shock hitting many American drivers is being driven by a rise in accidents, the severity of accidents, and geographical factors combining to create a perfect storm and push costs higher.

Read more: Tips for getting cheap car insurance

‘Severity’ and bodily injury claims on the rise

The most alarming factor driving insurance costs higher is more severe claims.

“In general, the numbers of crashes, injuries, and fatalities are up, and inflation has made the cost of repairs more expensive,” AAA spokesperson Robert Sinclair told Yahoo Finance.

Sinclair said motorists developed “bad habits” on the road during pandemic lockdowns, contributing to current behavior. For example, as the New York Times reported earlier this year, researchers in Nevada