MIAMI.- Driving has become a financial challenge for Florida residents. The Sunshine State has the third-highest auto insurance prices in the United States, according to a study by insurance comparison company Insurify.
According to the analysis, Florida drivers are paying an average of $2,917 annually for full auto insurance coverage. 44% higher than the national average of $2,014.
The data research team Insurify analyzed more than 97 million auto insurance rate requests in its proprietary database over the past five years in all 50 states and Washington, DC.
Florida also ranked second at 4.3% as the state with the highest percentage of income that people spent on vehicle insurance costs.
New York stands out in first place as the location with the most expensive vehicle insurance costs in the entire country, reaching record prices for full coverage policies of $3,374 a year.
Nevada follows in second place, with an average annual full coverage rate of $2,975, 47% higher than the country average.
On the other hand, New Hampshire has the lowest average annual car insurance price, just over $1,000 per year, and is the state with the lowest percentage of average income spent on costs, at just 1.2%.
Why are costs so high in Florida?
The report notes that although insurance companies have struggled to remain profitable, the Florida entity now faces an insurance crisis, with multiple insurers raising rates or suspending sales of new policies. The abandonment of insurance companies such as Farmers to the state affected approximately 100,000 clients.
The causes of these increases are diverse and include factors such as the “rampant fraud” of insurance that caused Florida rates to rise in 2023, vehicle thefts and flood damage, caused by severe weather events that put pressure on the state’s insurers. .
Given this situation, Governor Ron DeSantis signed into law HB 837 in March, designed to reduce lawsuits and fraud under the system.
Separately, the state legislature passed a bill in May to reduce auto glass fraud, which increased 4,000% between 2011 and 2021, according to the National Insurance Crime Bureau (NICB).
In Florida, having auto insurance is not only a necessity for personal and financial protection, but also a legal requirement that allows you to cover the costs associated with traffic accidents, protecting drivers against possible significant financial losses.
Florida law stipulates that all drivers must have auto insurance, which includes at least personal liability coverage and personal injury protection (PIP).
National increase
The study specifies that car insurance rates skyrocketed by 24% in 2023 throughout the national territory, due to the increase in the cost of repairs, climate catastrophes and serious car accidents that meant record losses for insurers.
Nearly 62% of Americans reported that their auto insurance rates increased in 2023, and nearly 22% reported that their rates increased more than once.
Researchers predict these rate increases will slow this year as the insurance industry stabilizes. While car insurance costs will increase 7% in 2024, almost double the average increase each year.
“The supply chain slowdown, labor shortages and inflationary trends that began to pressure the insurance industry during COVID-19 continued throughout 2023,” says Betsy Stella, vice president of carrier management and operations. from Insurify.
However, he added that “some pressure is easing. “Drivers can expect some stabilization as we enter the second half of 2024.”
@Lydr05
Source: With information from Insurify
