General car insurance coverage
The insurance industry, often known for its incredibly high profit margin and ability to make above average returns on their investments (i.e. your policy premium), has gone through a massive down cycle in the past year created by the sub-prime mortgage meltdown.
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Across the nation in select states major auto insurance companies are requesting (or more specifically notifying the insurance commission in advance) that insurance premiums are going to rise. With the sub-prime mortgage mess came massive losses and write-downs from the insurance companies, and very few if any of these companies were not affected at some point late last year, and on into the winter of 2009. Couple those losses on investment income with day-to-day losses due to claims (both legitimate and fraudulent) and you're looking at an industry in need of a serious boost.
How much will car insurance companies raise rates?
Of course, you want to know how much they're going to raise rates and what this means to you for what is likely already a substantial premium. The problem is, there's no set number and rates, as always, will vary from person to person. Let's look at the current insurance situation in Texas to get an idea. State Farm notified the insurance commission in late August that it would be raising policy-holders rates from 2.4% to over 7%, with no indication of how the increases would be assessed and against which of their nearly 3,000,000 policy-holders.
Further comparison of car insurance rates
Look at Texas, California, and New York for further guidance on rate increases, but most importantly don't be left in the dark. Insurance companies are losing money daily and something needs to be done. Sure, in the end the losses are passed on to their policy-holders and we end up footing the bill for their mistakes.
Now is the time to save money on car insurance. Request a free quote today!