By James Lynch, Chief Actuary, Senior Vice President of Research and Education, Triple-I
You have probably read news about rising inflation and car insurance has been drawn into the picture. But it's a little misleading.
Prices for car insurance do not rise. They return to normal levels before the pandemic.
Consumer prices in April were 4.2 percent higher than a year ago, the Bureau of Labor Statistics reported on Wednesday, and in its report, car insurance was selected as one of the areas that had "a major impact on the overall increase." [1
However, this does not mean that the cost of car insurance is skyrocketing. years ago – April 2020 – were busy bringing back billions of dollars to consumers due to the drastic change in driving patterns brought about by the pandemic, and official inflation figures reflected that.
Now the driving pattern returns to pre-pandemic norms – more People drive a little less than before, but they drive faster and are much more likely to tip over with their smartphones or practice other distracting behaviors, much like the old norm. Insurance, with the BLS index, is virtually unchanged from pre-pandemic levels – 0.01 per cent higher than it was in March 2020, when the pandemic / recession began.