Auto insurance rates declined in 2021 for the first time in a decade, according to a recent survey by ValuePenguin.com. The survey results anticipate a 1.7 percent decline nationally.
A major factor in the decline are the pandemic-related discounts granted by insurers in 2021. These discounts have been valued at $14 billion, according to Triple-I estimates. Triple-I Chief Actuary James Lynch reported that many auto insurers are building these discounts into rates for 2022 and that driving declined by as much as 50 percent during spring lockdowns.
The estimate of just how much rates are declining depends on the metrics you use. The Consumer Price Index (CPI) report for December 2021 indicates that auto insurance rates declined by 4.8 percent nationwide compared with the same month last year. By contrast, the CPI showed the cost of new vehicles rising by 2 percent in December and by 0.5 percent for the full year 2020.
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