Auto Insurance Costs on the Rise in Arizona

man holding a red toy car

A growing economy is definitely great news. But it turns out that it’s apparently not that good for auto insurance. Logic dictates that if the economy is strong, prices go low, including that of gas. Cheap gas means drivers go more miles which could give rise to car insurance claims. And you do the math, the end result Is insurances companies reacting by hiking up the premiums. This scenario is true as well in Arizona.

In 2016, car insurance rates in the country rose more than five percent in just a span of 12 months. This figure is based on the U.S Bureau of Labor Statistics. Another study shows premium for an average married middle age man rose up to nearly ten percent in just a year, even rising to more than $1,200.

Many car insurers say that the reason why they implement premium rate increases in auto insurance is to combat the recent cost headwinds. Despite the fact that number of accidents is declining, still the average payout on accidents is on the rise. Based on confirmed data, according to Insurance Research Council, the number of claims from 2005 to 2013 for bodily injury dropped down to 14.5. Despite this, the average cost per payout still hiked up to 32 percent. Within this period, the inflation rate spiked to 19 percent as well. The long-term trend shows that the high payouts are likely to continue heading in that direction.

The National Safety Council reported that last year, the auto fatalities rose to an average of eight percent. The problem with this figure is that it is the biggest annual increase in 50 years. This suggests that insurance company will try to offset their costs for years to come.

People who have clean driving record are more likely to enjoy certain advantages. However, a great record does not automatically immunize you from any rate hike. The reason for this is that aside from a driving record, there are other factors that are involved. These include non-driving factors like your credit profile.

But there are still ways to get the best auto insurance deal despite the fact the cost is on the rise in Arizona.

Auto Insurance Fraud

One of the many concerns of insurance companies are fraud claims. Today, companies has many ways how to detect insurance fraud.  Insurance fraud cost millions of loses according to State Insurance Fraud Bureau. 

2 Ways to Get The Best Auto Insurance Deal

  1. It’s always safe to shop around. Many people just go straight to an insurance company without checking on others or without weighing on the reputation of such company. So the best way, really, to get a good auto insurance deal is to go to the right insurance provider. This is true whether you are switching or applying for one.
  2. Another helpful tip is to choose a higher deductible. While it is tempting to just stick a lower deductible, the best thing to do actually is to go for $1,000 or even higher deductible. This is because a higher deductible will help you avoid on making small claims, which could actually save you plenty of money.

While auto insurance costs may continue to rise in Arizona, the wise thing to do is to find a way to navigate through it. To find out more about auto insurance, check out Gebhardt Insurance.

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Steve Gebhardt

Gebhardt Insurance Group was honored by AAA Insurance for being the top New Policy Agency in Arizona for 2013 and achieving the "Emerald Achievement Award."
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