What is insurance inflation?

Across the United States, car insurance costs have surged, experiencing a staggering 19% increase compared to previous years. This surge marks the most significant annual rise since 1976. However, the impact is even more pronounced in states like Florida, where extreme weather events are becoming increasingly frequent and destructive. Insurance companies in the state are grappling with a surge in claims due to these events, resulting in higher losses. To offset these costs, insurers are raising rates or, in some cases, withdrawing coverage from states prone to extreme weather. For instance, drivers in Florida are now paying an average of $3,183 per year for full-coverage policies, reflecting a 15% increase from 2022.

The article “Car Insurance Rates Just Had Their Biggest Annual Jump in 47 Years. This Is Why” on CNN’s website delves into the factors behind this insurance inflation, including the influence of climate change, severe weather patterns, and the resulting financial strain on insurers.

You can read the full article here. It provides valuable insights into the challenges faced by both insurers and policyholders in navigating the evolving landscape of car insurance rates.

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