Last year, an important change was noted in terms of state ranking by vehicle coverage quotes: a significant Texas car insurance rates increase placed the state at number 11 in the chart of the U.S.’s highest premiums. The information was supplied by a regulating body in the car insurance industry, the National Association of Insurance Commissioners (or NAIC), which pooled vehicle insurance quotes from all states in the nation.
Texas car insurance rates increase significantly for collision coverage
The cited study looked at several indexes included in the cost of car insurance. On the one hand, it took into analysis the price of coverage for fixing trucks and cars in the case of accidents, also referred to as collision coverage. This expense does not represent the full cost of vehicle insurance, but it is significant, since it involves all the costs that policy covers for, in order to fix damage incurred to a vehicle as the result of an accident. It found that the upward trend posted by this index in the past few years was also confirmed in 2009. The survey analyzed data from 2009, since that is the most recent nationwide set of figures. At the moment when the study was released, at the end of January 2012, Texas ranked 5th of all American states by collision coverage costs.
However, it’s important to note that the Texas car insurance rates increase did not affect the amount of money that drivers have to pay for liability coverage. Texas ranks 20th among all states according to this criterion and many chalk this up to the lobbying of liability coverage advocates, who have also been aiming to reduce the number of lawsuits resulting from car accidents.
Texas car insurance premium average stands well above national average
The study confirmed also confirmed a fact that many Texas vehicle owners and coverage holders have been intuiting for a long time. Vehicle insurance in the state of Texas is far more expensive than elsewhere around the country. On average, a Texas motorist pays out $1,022 in insurance premiums each year, while the national average for premium costs is over $100 cheaper, and has been calculated at $901. Texas is not the only state in this situation – there are about a dozen of other states in the US in which the average vehicle insurance premium costs more than $1,000. The most expensive car insurance premiums are being paid out by drivers in Louisiana, who shell out $1,270 each year, in order to have their cars insured.
What are the reasons behind the Texas car insurance rates increase? The large number of uninsured motorists in the state, says one representative of the insurance industry. Collision coverage is priced highly in Texas, because the numerous drivers without coverage pose a higher risk in Texas than in other states. The cost of collision coverage has also been allegedly driven up by the rising prices at car repair and body work shops around the state. But while the reasons may be numerous and complex, the situation of the Texas car insurance rates increase remains problematic and unlikely to drive more motorists to purchase insurance for their vehicles.