Best Car Insurance Companies of February 2022 – Forbes Advisor

Auto insurance rates have been rising steadily for decades, with the exception of a sharp drop in 2020, when auto insurance companies offered refunds and credits to provide financial relief to customers facing declines revenue related to the pandemic and to take into account the sharp reduction in driving. .

Over the years, soaring medical bills and increasingly expensive car repairs have conspired to continually increase what we pay for car insurance. But for the most part, consumers either think car insurance rates are fair or don’t have very strong feelings about them. A new survey by YouGov for Forbes Advisor found that 48% of American adults think auto insurance rates are “fair” or “very fair.” Another 18% are on the fence, judging the tariffs neither fair nor unfair.

Of the 31% who find auto insurance rates “unfair” or “very unfair,” half (50%) have done nothing in the past 12 months to find a solution. About a third say they have at least obtained an insurance quote from another company, and 11% have changed companies. A notable proportion (12%) say they have reduced their overall auto insurance coverage in the past 12 months.

While nearly half of Americans think auto insurance rates are fair, a closer look under the hood reveals that “fairness” drops rapidly when people are asked about specific pricing factors commonly used to set auto insurance rates.

Use of credit? 69% don’t like it

For example, 69% of survey respondents did not think a driver’s credit score should be used in car insurance rates, but many insurers place considerable importance on credit-based insurance scores when of pricing.

Insurers say they can correlate bad credit with a person’s chances of making car insurance claims. Although insurance rates are regulated by each state’s Department of Insurance, states generally allow rating factors such as credit where insurers can demonstrate a connection to higher claims. Only California, Hawaii, Massachusetts and Michigan prohibit the use of credit in auto insurance rates.

When the Washington State Insurance Commissioner banned the use of credit for insurance rates earlier this year, he was immediately hit with insurance industry pushback and a lawsuit. But the credit ban ultimately prevailed, taking effect on June 20.

Since the use and extent of credit in rates can vary widely between insurers, a driver with poor credit could especially benefit from shopping around.

Car insurance rate increases due to bad credit

Level of education? 67% say it’s a failure

Many car insurance companies provide education-related discounts, rewarding drivers who have earned a bachelor’s, master’s, or doctorate degree. But 67% of survey respondents disagree that education level should be a factor in car insurance rates.

Still, 21% supported the idea. Insurers may include education level in rates when they have linked higher education to lower claims.

Use of the profession? May be

While the use of credit or education level in auto insurance pricing was controversial, the use of occupation was not as controversial: 44% did not think a driver’s occupation should affect prices, but 36% thought it was acceptable.

Like other pricing factors that do not relate to actual driving, some insurers give discounts for certain professions. For example, lawyers, doctors and educators may be able to get lower rates.

Actual driving monitoring? people are divided

Usage-based auto insurance, which uses actual driving data in rates, could reduce reliance on price factors other than driving, such as education. Using telematics, these insurance programs monitor and log actual driving, such as speeding, braking and cornering.

About half (51%) of survey respondents said they would be “very comfortable” or “somewhat comfortable” with close supervision of their driving if it could result in lower insurance rates automobile. A smaller proportion (44%) were reluctant, expressing discomfort with such surveillance.

So, as car insurance companies look for more accurate ways to assess individual “risk,” drivers may find fewer and fewer options that don’t use highly personalized metrics.

Survey methodology

YouGov surveyed 2,000 American adults. The survey was conducted on June 24, 2021. The survey was conducted via YouGov Direct. Data is weighted by age, gender, level of education, political affiliation and ethnicity. Results are nationally representative of adults in the United States. The margin of error is 3.0%.

Kristan F. Talley