Car insurance rates going up, COVID-19 to blame

INDIANAPOLIS (WISH) — If your car insurance rates have gone up, you’re not alone. Premiums are in the rise, and the COVID-19 pandemic is partially to blame.

“You may remember that back during COVID-19 in 2020, auto insurers lowered rates and returned around 14 billion dollars nationwide to their policy holders because fewer people were driving,” Scott Holeman, spokesperson for the Insurance Information Institute, which is a non profit that educates consumers about insurance, said.

Now, the exact opposite is happening. There are more drivers on the road, and that means more accidents. Because of a labor shortage, car repairs take longer.

“We have more and more cars with sophisticated technology, and those tech savvy cars are designed to keep people safe, but with that technology is a higher expense,” Holeman said.

A parts shortage, inflation, and supply chain problems are also to blame.

Lawsuits and bad driver behavior are also driving up premiums. Holeman says it’s hard to predict when rates will go back down.

“We continue to see that people are driving more dangerously, and so a lot of it is going to depend on driver behavior,” he said.

Indiana is one of the cheaper states for auto insurance. Holeman adds that if you are still working from home, you may be able to negotiate a lower insurance premium. Where you park and how much you drive could also impact your rates.