Car-insurance rates, after falling for several years, may be heading up again.
A study by Insurance.com, an online insurance agent, found that on average, its lowest quotes increased an average of 3.4% nationally during the second quarter of 2008, compared with the previous quarter. It was the second consecutive period that prices rose.
The average quote was $1,893 per year. The report is based on quotes given to consumers by 15 insurance companies in most states.
States that saw the largest price increases included Indiana, up 6.7%; Arkansas, 6.1%; Texas, 4.3%; Nevada, 4.1%; and Illinois, 3.8%. Pennsylvania saw a boost of 3.6%. The gain in Indiana reflected an average increase of $94, for a total of $1,501 per year.
Until recently, car insurance had been a bright spot for drivers in an otherwise bleak landscape of rising expenses: Premiums had been flat or declining in many areas in the past few years.
Robert Hartwig, president of the Insurance Information Institute, a trade group, said based on federal statistics, auto-insurance prices rose at a 2.6% year-over-year pace in May and June. He said the increase for all of 2007 was 0.4%.
Sam Belden, consumer director of Insurance.com, said higher medical costs and repair expenses are driving the increase. He added that he believes the price jumps mark the beginning of a trend that could last through 2009, but could be reversed if higher oil prices lead to a long-term change in driving habits. "Less miles on the road mean less accidents," he said.
Insurance premiums weren't rising everywhere. The Insurance.com numbers showed declines in states including North Carolina, down 8.7%; New Hampshire, 4.1%; Tennessee, 3.7%; Louisiana, 3.6%; and Delaware, 3.3%.
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