State Farm to raise Illinois auto insurance rates for 2nd time this year in June - Chicago Tribune

jokbanga.blogspot.com

As gas prices plateau near record highs, auto insurance rates keep creeping up in Illinois.

State Farm recently filed for a 3% rate increase with the state’s Department of Insurance, set to take effect on June 13. Combined with a 4.7% increase that hit in March, State Farm customers will pay about $59 more per year to insure each vehicle.

“Auto claim costs are increasing in part due to a rise in the cost of labor, materials and supply chain-related issues,” State Farm spokeswoman Angie Harrier said in an email. “State Farm isn’t immune to some of these industry trends.”

State Farm, Allstate and Progressive — the three largest auto insurers in Illinois — have all filed for rate increases this year, following the industrywide rate cuts and rebates that proliferated during the pandemic, where reduced driving lowered costs. The biggest drivers of higher auto insurance premiums are increased prices for new and used cars, supply chain disruptions, the labor shortage and rising medical costs, according to industry analysts.

In 2020, State Farm cut auto insurance rates in the state by 13.7% as many drivers parked their cars at the onset of the COVID-19 pandemic. In February 2021, State Farm reversed course, raising rates by 4.2%. But even with two increases this year, State Farm auto insurance rates will be lower than they were in 2019, Harrier said.

“Although miles driven, claim volume and severity have increased, State Farm auto rates in Illinois still remain below pre-COVID-19 levels with this latest rate adjustment,” Harrier said.

Northbrook-based Allstate, the state’s second-largest auto insurer, went big in January when it filed for a 12% rate increase, essentially unwinding its rate cuts over the past two years.

In spring 2020, Allstate issued about $1 billion in rebates to auto policyholders nationwide with its “Shelter-in-Place Payback” at the onset of the pandemic. Allstate cut rates in Illinois by about 5% in January 2021, but raised them by 2.5% in September, according to state filings.

With the latest increase, which went into effect Feb. 17, Allstate’s auto insurance rates are now above the pre-pandemic level.

Allstate signaled during its first quarter earnings release Wednesday that customers could see more increases down the road this year.

“Allstate is taking comprehensive action to improve profitability, including rate increases, reducing expenses and claims operational actions,” the company said. “Given ongoing inflationary pressures, we expect to implement rate increases greater than our initial expectations for 2022 to restore auto margins to target levels.”

Ohio-based Progressive, the third-largest auto insurer in Illinois, filed in January for rate increases ranging from 6.3% for its direct customers up to 10.1% for those who use an agent, according to state filings.

rchannick@chicagotribune.com

Adblock test (Why?)

"auto" - Google News
May 05, 2022 at 09:51PM
https://ift.tt/fPLJdBc

State Farm to raise Illinois auto insurance rates for 2nd time this year in June - Chicago Tribune
"auto" - Google News
https://ift.tt/taJQeCg
https://ift.tt/IycPZAr

Bagikan Berita Ini