The Wall Street Journal warns two out of three major car insurers are seeking signifiant increases in auto accident premiums. Allstate sought and got approval for a 3.9 percent rise in insurance premiums for its main product. Geico, which is owned by Warren Buffet's Berkshire Hathaway, also indicated premiums would be raised "as needed" to help offset rising costs of claims. Motorists are warned to expect "a prolonged period of rising premiums," and multiple rounds of price increases for auto insurance.
Insurance rates are rising in large part because more claims are being made - and more claims are being made because accident rates are rising. Motorists who are injured must understand their rights when it comes to recovering money from insurance companies. With rising rates of serious or fatal accidents, there could be many more collision victims forced to undergo the difficult process of fighting for car crash compensation.
Rising Car Crash Rates Driving Insurance Increases
The reason car accident insurance rates are going up so much is because accident rates have also gone up dramatically. National Highway Traffic Safety Administration (NHTSA) reported on the rise in collision fatalities in 2015, compared with 2014.
There were 8.1 percent more people killed in traffic collisions in 2015 than the number killed over the course of 2014, based on NHTSA's preliminary estimates for 2015. This is not as bad as National Safety Council (NSC) predicted in the middle of the year after NSC had reviewed data on crashes from the first six months of the year. NSC had anticipated a 14 percent rise in car accident deaths, in large part because the death rates had gone up in more than 30 states for the first half of the year.
There was also a 4.4 percent increase in fatality rates over the entire year, according to NHTSA. Fatality rates try to get a more accurate picture of road safety by accounting for any mileage increases which could be a reason for more crashes. The fatality rate for 2013 was 1.07, but fatality rates for 2015 are up 4.4 percent compared to just the year before.
Some speculation suggests the rising number of deaths is driven by improved economic conditions, including lower unemployment rates. The dramatic decline in gas prices to a level which is the lowest since 2010 has also helped tremendously in encouraging more driving, and thus exacerbating collision risks. The reality, however, is rising fatality rates mean there's more than just extra miles driven contributing to the higher death rates.
Drivers need to stop doing things that are likely to cause accidents if the death rate is to begin declining again, especially with more people on the roads. Drivers should avoid drinking (which causes 1/3 of fatal accidents), as well as behaviors like drowsy and distracted driving which cause around three percent and around 10 percent of collisions respectively.
Drivers who focus on safety first, and who avoid breaking traffic laws, are going to be much safer than motorists who make mistakes. Unfortunately, no driver can control the actions of others, so every driver is vulnerable when crash rates rise, no matter how careful they are.