We’ve been reading a lot about rising auto insurance rates lately. While not everyone’s rates are expected to rise, there is good reason why we have seen an increase.

According to our industry experts, here are the top 3 reasons for a bump in the auto insurance pricing road:

  1. More auto claims are being submitted.

It’s just a fact. There are more cars are on the road than ever before and more miles are being driven every day. According to the U.S. Department of Transportation, in 2015 Americans logged 145 billion more miles than any other time in history. Lower prices at the tank and lower unemployment rates may be the primary reasons for the increase. The projected 2016 average price of a gallon of gas was only $1.94, a 12-year low. The national unemployment rate dropped to 4.9% in January 2016.

Unfortunately, more drivers equates to more accidents.

  1. Crowded roads and more distractions are driving up the frequency of car accidents.

A recent study conducted by Virginia Tech University found driver distraction responsible for 70% of 900 serious crashes that occurred during the study. And, a recent AAA survey found over half of the drivers on the road have engaged in at least one risky behavior in the last month, such as texting, reaching for objects, or using the touchscreen on a GPS.

According to a new study from Insurance Institute for Highway Safety, rising speed limits are also costing lives on the road. Increases in speed limits over two decades have cost 33,000 lives in the U.S. In 2013 alone, the increases resulted in 1,900 additional deaths, essentially canceling out the number of lives saved by front airbags that year.

It’s not just more accidents causing the issues; the severity of accidents is also increasing services and costs.

  1. Worse accidents with a greater number of fatalities means higher medical and repair costs.

According to the National Highway Transportation Safety Administration (NHTSA), 2015 had the largest increase in vehicle crash fatalities in more than 50 years. With the cost of medical care rising faster than inflation, this means increased costs for medical claims.

Some of the increased costs are also tied to vehicle enhancements and innovations, such as; forward looking radar, side impact warning systems, back up cameras and even automated-parallel park features. Increased use of alternative materials in car manufacturing, such as aluminum, carbon fiber, high-strength steel just to name a few – is also contributing to increased costs.

We will continue to keep my eye on trends like these and update you here. At VIP Insurance we do everything we can to offer competitive rates for auto insurance. Please give us a call for a free, no-obligation quote anytime.