If you’ve received a renewal notice for your auto insurance, or tried to purchase a new policy, you may have noticed that options are extremely limited and the cost is through the roof. Here’s what you need to know:
1. The California Insurance Commissioner has approved more than $1 billion in premium increases at the state’s top six companies, which insure about 48% of California registered vehicles.
2. Many companies have temporarily stopped writing new business in California, while others are implementing paid in full requirements or hold times between when you purchase your policy and when your policy becomes active. These can run anywhere from 3 days to 10 days, and you must pay for this coverage in advance.
3. People are driving about as many miles as they were before the pandemic, but they’re doing so less safely and causing more accidents.
4. The cost of your premium is directly tied to the money your insurance company pays out when you file a claim. This includes parts and repairs, rental cars, medical bills. Because all of those sectors are experiencing price increases or supply chain issues that cost is going to be passed along to you.
SO WHAT DO I DO?
This is one of those times where having an independent agent is a huge asset if you run into trouble, we’re here to help you in any way possible. In the meantime, we STRONGLY recommend that you do the following:
1. Make sure your current policy is on auto pay. If your policy cancels because of a late payment, even a single day, there will be consequences you may not have faced in the past. If we are able to reinstate the policy with the same company, the cost of your premium is going to go increase, sometimes by as much as double, in cost. Additionally, you will no longer be able to reinstate your coverage on the same day and will be subject to the same 3-14 day waiting period. If we need to place your policy with a new company you can expect the same thing, higher premiums and a waiting period before your policy becomes active. In all of these situations you will be required to pay some or all of the policy in advance.
2. Plan ahead. If you’re looking for a new car, know your policy expiration date is coming or aren’t going to be able to make your payment in time, get in touch with us as far in advance as possible by email or calling us at (760) 271-6651. The more we know about your situation the more helpful we can be.
3. Expect to pay more for new coverage and expect to pay a larger portion up front, at least for now. We’re here to help, but please understand that options are limited right now.