At ERIE, we don’t take the price you pay for car insurance lightly. Like most businesses today, we face increased costs of doing business. And we know you’re also facing rising costs, on everything from gas to breakfast cereal to housing.
And while many factors play into what you pay – from vehicle safety assessments to your personal driving history – the balance between insurance premiums and the cost of doing business is key to any insurer’s ability to meet customer expectations and pay for claims.
See also: What determines the price of my car insurance?
For questions about your specific car policy and price, contact your ERIE agent. But generally speaking: Here are some of the biggest factors that could cause car insurance premiums to rise in 2022:
- Inflation: The consumer price index (CPI) rose by more than 7 percent compared to 2020 – the biggest increase in nearly 40 years. This means that we are all spending an average of 7% more than a year ago for the same goods and services.
- Vehicle Parts: The inflation we just talked about is even higher when it comes to auto parts, with those prices up by close to 10%. (Historically, a 2 to 3% increase year over year is more typical.)
- Repair costs: Recent supply chain issues like auto chip shortages and pressures on the labor market have driven up repair costs even more, by as much as 20% since 2020. Limited supplies and labor can also make repairs take longer, meaning customers are in rental vehicles longer — further driving up the costs of injuries.
- Vehicle prices: Used vehicle prices rose more than 27% in 2021, according to auto industry analysts at Edmunds. New vehicle prices have risen by more than 14%.
- Run again (and faster): As driving returns to pre-pandemic levels, Americans are driving faster than ever before. In a national survey commissioned by ERIE, 1 in 10 drivers admitted to driving at extreme speeds of 20 MPH or more over the speed limit.
- Accidents: It shouldn’t be a surprise based on all the fast driving, but car accidents are also getting more serious. The National Highway Traffic Safety Administration has reported a 12% increase in fatalities, the largest increase since reporting began in 1975.
With inflation on the rise, we understand if you are feeling financial pressure in your household budget right now. That’s why we keep our founding purpose at the center when we make decisions that affect our customers:
“To provide our policyholders with as close to perfect protection, as close to perfect service as is humanly possible and to do so at the lowest possible cost.”
This purpose has served us well for nearly 100 years and we hope our customers agree that it has worked pretty well for them too. ERIE is committed to pricing that properly covers costs and will maintain the financial strength required to continue to be there for customers, year after year.
See also: How to find good and cheap car insurance
How to save on your car insurance
While we want to do our best to explain what’s behind the increased costs you may see on your insurance bill these days, we also understand that it doesn’t put any more money in your pocket. So here are some ideas that can.
- Ask about discounts on the salary plan. Depending on which plan you choose, you can save up to 7% on your car insurance.
- Get a quote with ERIE Rate Lock® feature1. With ERIE Rate Lock®, you pay the same premium year after year – even if you have a claim. Your rates will not change until you make certain changes to your car insurance, such as adding or removing a vehicle or driver from your policy, changing your address or where you usually park your car. (In New York, ask about ERIE Rate ProtectSm. Ask about ERIE Select Auto in Maryland.)
- Take a look at your deductibles. Consider a higher deductible to lower your car insurance premium. Read our guide on how to choose a deductible.
- Review your mileage again. Do you work from home and drive less than before the pandemic? You may be eligible for a lower rate based on annual miles driven. (Reduced use discount not available in Kentucky.)
- Bundle your coverage with ERIE. You can get a discount with multiple policies2 when you combine your ERIE auto, home (including renters) or qualifying life insurance. Read more about how to pack with ERIE.
Oh, and discounts? We have them. Get the details in our full list of car insurance discounts.
Remember: You are not alone.
When you’re with ERIE, every auto insurance policy comes with a knowledgeable agent in your area.
Your agent is there to help you understand and navigate all the variables that affect your rates. Contact us to understand what coverage you’re buying, why it’s important and how it works.
Not an ERIE customer yet? See if ERIE can offer a more affordable price for car insurance and get a quote.
1 Prices may change if you add or remove a vehicle, add or remove a driver, or change your address or the place you usually park your car. ERIE Rate Lock® does not guarantee continued insurance coverage. Not available in all states. Limited to three years in Virginia. The insured must comply with applicable underwriting guidelines. The premium may change if you make a policy change. See our warningfor more information.
2 All discounts are subject to eligibility criteria and applicable prices and rules at the time of purchase. Actual savings vary. Multi-policy life discount is not available in conjunction with auto policies that already utilize ERIE Rate Lock®. Erie Family Life insurance products are not available in New York. For further information, contact us today.