Auto Rates Jump for Third Straight Quarter

Auto insurance rates continued to rise throughout the third quarter this year, according to a study by Insurance.com.

Insurance.com’s RateWatch for Car Insurance found that the lowest car insurance quotes, on average, were up 3% over the previous quarter, rising from $1893 per year to $1949 per year. This 3% hike follows a 3.4% increase in the second quarter.

RateWatch is based on real-time auto insurance quotes from more than a dozen insurance companies given to consumers at Insurance.com during the third quarter. It marks the third consecutive quarter of rate increases, causing concern among cash strapped drivers who are already struggling in this challenging economy.

“The increase in rates this quarter represents a trend that will most likely continue into 2009,”– Strategic Alliances at Insurance.com. “Drivers should take some time to understand how the type of car they drive, and their driving habits, affect their rates.” said Sam Belden, VP

Car insurance rates vary by state, and some locales experienced rate quote increases in the third quarter that were greater than the average. For example, Washington, D.C. had an 8.3% increase in rates, while Nebraska and Rhode Island saw rates jump 8% and 7.4%, respectively.

“There are many things consumers can do to save on car insurance, like comparing rates from several companies before they renew a policy, driving more carefully, and never letting a current policy lapse,” said Belden. “When a driver does not have continuous coverage, he or she may not qualify for the best available rates, and may be placed in the same risk category with drivers who have violations and accidents. This can cost a driver significantly more money for years.”

Additional Findings

• Among the top 10 states seeing the sharpest increase in car insurance rates in the 3^rd Quarter were Washington, D.C. (up 8.3%), Nebraska (up 8%), Rhode Island (up 7.4%), Kansas (up 6.6%), and Florida (up 4.9%).
• Rates in 10 states decreased compared to 2^nd quarter. The largest decreases were in North Dakota (down 7.8%), West Virginia (down 7%), and Wyoming (4.5%).
• In 9 states, rates were essentially unchanged, varying by less than one percent.

The full report is available at www.insurance.com/ratewatch.