More consumers are shopping for new insurance rates because they cant afford their current policy. (iStock)
Consumers picked up insurance rate policy shopping in the first quarter of 2024 as they searched for more affordable options, according to a new report from J.D. Power and TransUnion.
The uptick in insurance shopping follows two continuous quarters of consumers seemingly accepting there were no discounts to be had. In January, shopping rates increased to 12.1% from 11.7% and increased again to 12.5% in February. Shopping rates jumped up 13.5% in March, with consumers in the South shopping for new rates at a greater pace than anywhere else in the U.S. The switch rate rose to 3.9%, up from 3.6% at the end of 2023.
Consumers said their reason for shopping was because of the cost of their insurance. Nearly 22% said they shopped because of a rate that was too high, compared to 16.9% the previous quarter. Additionally, 14.6% shopped for a new insurer because their rate recently increased compared to 7.9% in the last quarter.
“Both property and auto insurance shopping change dropped at the end of 2023, mostly due to predictable seasonality,” the report said. “As the industry moves through 2024, market dynamics are likely to evolve, and a case can be made that shopping will remain strong well into 2024.
If you are looking to save money on your car costs, you could consider changing your auto insurance provider to get a lower monthly rate. Visit Credible to shop around and find your personalized premium.
MIDDLE-INCOME AMERICANS FEEL MORE OPTIMISM ABOUT FINANCES AND ECONOMY’S DIRECTION: SURVEY
Car insurance rates continue to rise
Drivers paid an average of $1,841 to insure a car in 2023, or 5% more than they did the previous year, according to a recent report from the Zebra. That comes after a 15% jump between 2022 and 2023. Unfortunately, 2024 is likely to bring more of the same.
Where you live can significantly impact how much you pay for insurance. For example, states more affected by climate-related disasters have seen a higher incidence of insurance providers pulling out or writing new policies, leaving buyers with fewer options for insurance shopping.
The make and model of a vehicle have also greatly impacted car insurance costs. Drivers of Kia and Hyundai cars have had difficulty insuring these vehicles because certain models are highly stolen.
Florida and Louisiana top the list of states with the highest annual premiums. Drivers here pay an average premium of more than $2,700 per year. That’s 47% more than the national average. Drivers in Vermont and Idaho pay the least, with annual premiums registering 35% below the national average. Drivers in 19 states now spend an average of more than $2,000 a year in auto insurance premiums.
Are you shopping around for new auto insurance? The Credible marketplace can help you compare multiple providers and find your personalized rate in minutes without affecting your credit score.
How to lower your car insurance
With premiums set to increase this year, drivers should consider switching their car insurance coverage before renewing an existing policy to get a better rate.
Here are some tips if you are thinking about switching:
Know what you want from your insurance
Have a plan and understand what you need from your coverage. Knowing what you want to improve before you switch can improve your chances of getting the best rate.
Get multiple quotes
Shopping for the same auto coverage strategy and limits with multiple insurance carriers can help get you the best deal possible. Get at least three different quotes.
Contact your insurance company
Let your current insurance company know that you are switching – there’s a chance that your insurer could match a cheaper quote. Ask about a cancellation fee or a refund if you have prepaid and are canceling mid-policy. Make sure not to cancel your current policy before you buy a new one. Otherwise, you risk a lapse in coverage.
If you are shopping for new auto insurance, you can use the Credible marketplace to compare multiple providers and find your personalized rate in minutes without affecting your credit score.
REPUBLICAN STATES FILE SUIT TO STOP BIDEN’S SAVE STUDENT LOAN REPAYMENT PLAN
Have a finance-related question, but don’t know who to ask? Email The Credible Money Expert at moneyexpert@credible.com and your question might be answered by Credible in our Money Expert column.