Why Are Auto Rates Increasing in Georgia?

Why Are Auto Rates Increasing in Georgia?

May 16, 2023

Driving through Georgia can be a beautiful and exciting experience, with its lush landscapes and historic towns. However, for many Georgians, the cost of auto insurance has been rising steadily in recent years. 

5 Reasons Why Auto Insurance is Increasing in Georgia

One of the main reasons auto insurance rates are increasing in Georgia is due to an increase in car accidents.

According to the Georgia Department of Transportation, there were 1,549 traffic fatalities in Georgia in 2020, which is a 16% increase from 2019. The number of accidents has also increased, with the Georgia Department of Transportation reporting 385,221 total crashes in 2020, which is a 2% increase from 2019. With more accidents, insurance companies have to pay out more claims, which can lead to higher premiums for drivers.

Another factor contributing to the rise in auto insurance rates in Georgia is the cost of car repairs. 

As cars become more technologically advanced, repairs can become more expensive. According to CarMD, the average cost of a repair in Georgia was $426.14 in 2020, which is a 3.3% increase from the previous year. With more expensive repairs, insurance companies may have to pay out larger claims, which can result in higher premiums for drivers.

Georgia's legal environment can also contribute to higher auto insurance rates.

Georgia is a tort state, meaning that drivers can be sued for damages in the event of an accident. This can result in higher payouts for insurance companies and higher premiums for drivers. Additionally, Georgia has one of the highest uninsured motorist rates in the country, with an estimated 12.6% of drivers being uninsured. This can also contribute to higher premiums for insured drivers.

The COVID-19 pandemic has also had an impact on auto insurance rates in Georgia. 

With fewer people driving during lockdowns and remote work arrangements, there were initially fewer accidents and insurance claims. However, as restrictions were lifted, more people began driving again, leading to an increase in accidents and claims. Additionally, the pandemic has led to supply chain disruptions, which can impact the cost of repairs and replacement parts.

Finally, it's worth noting that auto insurance rates can vary based on a number of factors, including age, gender, driving history, and type of vehicle. While these factors may not be unique to Georgia, they can still contribute to higher rates for some drivers.

There are several factors contributing to the rise in auto insurance rates in Georgia, including an increase in accidents, higher costs of repairs, Georgia's legal environment, the impact of the COVID-19 pandemic, and individual driver factors. While it may be frustrating for drivers to see their premiums increase, it's important to remember that insurance companies are businesses that need to balance their payouts with their revenue. By understanding the factors that contribute to higher rates, drivers can make informed decisions about their coverage and work to minimize their risk of accidents and claims.