SAINT ANTONIO – Car owners could be in for an expensive surprise when it comes time to renew their insurance.
According to Texas insurance board officials, the rate increases were expected to go back to a 2018 trend.
“If we think of a car from 10 or 15 years ago, a bumper was a piece of steel that was bolted to another piece of steel. Now you have plastic on steel that has five sensors and a rearview camera,” said Rich Johnson, Director of Communications for the Texas Insurance Council.
Texas Insurance Council Director of Communications Rich Johnson told KSAT that they expected the improved product of what’s on the road to cost more. They failed to account for the pandemic, supply chain issues, and labor shortages.
Supply chain issues cause problems, like sourcing auto parts. Additionally, labor shortages make it more difficult to get employees to perform certain repairs, lengthening the time someone might have to drive a rental vehicle. These factors are in addition to what an insurance company covers.
“This is something we haven’t seen. This is something that is different. In 2022 we saw an increase of around 20%. I think it will probably be a little more in 2023… I don’t want to give a specific number because I don’t know yet,” Johnson said.
A study by research firm Valuepenguin states that auto insurance is expected to rise 8.4% in the US this year.
“I actually just bought a new car, and when I switched to a new coverage, it actually went up like double,” said Cameron Tabb, a man who recently switched insurance.
Tabb said he only knew about the increased fees because of his new bill. Others, like Jesse Arias, have heard of it but haven’t seen it firsthand.
“Just another thing in life that goes up. I mean, everything is going up in life right now. I mean, you’re talking about food, talking about going out,” Arias said.
Rich Johnson of the Texas Insurance Council says that people can try to save money by comparing and adjusting deductibles with the help of insurance professionals. If you have a student with good grades, report them and see if a defensive driving course qualifies for a discount.
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