Connect with us

Business

It’s not just inflation—here’s why your car insurance rates are almost certainly going up this year

Published

on

The General curated a list of why car insurance rates are inevitably rising in 2023.
Share this:

If you haven’t received a notice yet that your auto insurance rate is increasing, you can likely expect one is coming.

The General compiled a list of factors that may contribute to higher car insurance rates, including data from the Insurance Information Institute, the Bureau of Labor Statistics, the National Highway Traffic Safety Administration, and other industry sources and news coverage.

Shortages of parts and new vehicles, waves of retiring mechanics, and deadlier roadways are changing the automotive insurance landscape for insurers and you—the driver. That’s on top of the fact that the value of new vehicles has skyrocketed since 2020, charting their largest gains in 2021 as Americans returned to offices, restaurants, and social events again, pushing up demand for both new and used vehicles.

New vehicles have sold for above sticker price for nearly a year and a half now, according to Kelley Blue Book. New cars cost 18% more in October 2022 than they did in October 2020, according to the BLS. Meanwhile, used car prices increased by 29% over the same time period.

Generally speaking, any form of insurance is premised on complicated financial schemes that balance cost and risk while also turning a profit and sheltering consumers’ exposure to financial ruin. Most states have laws that require drivers to carry a minimum level of automotive insurance to help spread out risk.

When an insurer has to pay out more in claims than it takes in through premiums, the company could become insolvent and collapse. Therefore, insurance companies are constantly evaluating and adjusting the amount of money they need to collect in premiums—either semiannual or annual charges, often paid in monthly installments—to avoid taking losses.

Of course, insurers also evaluate how much to charge a client based on their assessment of how likely it is the client will trigger reimbursement for damages. And those factors can extend well beyond just the client’s driving record to include their education level and occupation.

“Underwriting losses are expected to continue as more rate increases are needed to offset catastrophe and economic and social inflation loss pressures,” Jason B. Kurtz, a principal at financial consulting firm Milliman, said at a virtual industry conference in November.

The Insurance Information Institute’s chief insurance officer is projecting rates will have risen 8.8% over the course of 2022 and are on pace to rise another 8.9% in 2023. The institute points to difficult economic conditions as well as climate disasters as reasons companies are anticipating losses in the coming year. Hurricane Ida’s impact has already bankrupted 11 insurance agencies since it made landfall in August 2021, and the aftermath of 2022’s Hurricane Ian could do further damage.

Mechanic working on car engine.

Standret // Shutterstock

Rising auto shop wages

The median pay for auto technicians and repairers surpassed the $22 per hour national median for all occupations in 2021. They now earn a median pay rate of $22.55 per hour, a 6.4% increase from 2020, according to the Bureau of Labor Statistics.

The workers who put your car back together after a wreck command more wages as the veteran trade workers who retire from the workforce. Dealerships and lobbying groups have struck partnerships with schools and nonprofits in recent years to train the next generation of auto technicians. Their jobs have become increasingly technologically advanced as cars are loaded with more computer parts.

The costly dilemma for drivers is only anticipated to continue for the foreseeable future at least. The Bureau of Labor Statistics anticipates the number of auto technicians employed in the U.S. will remain roughly unchanged through the end of the decade.

Automobile production in a factory.

Jenson // Shutterstock

Supply chain challenges

Due to production challenges introduced by COVID-19 and varying government mitigation plans worldwide, new vehicles are also in short supply. With high prices on the ones that are available, drivers are keeping the cars they have longer. The median car on American roads is older than ever and may need more frequent maintenance.

Car parts are in high demand this year, but parts-makers are still working to catch up to that demand, according to a report from collision repair tech firm CCC. Combined with difficulty finding workers, vehicles are taking longer to repair and causing consumers to use rental cars for longer—another additional expense for insurers. Repairs took 2.1 days longer in 2021 compared to 2019 on average, per CCC.

Adding to costs, rental car agencies spent the last several years selling their inventory to cover expenses in downtimes. They, too, are struggling to purchase new vehicles, sending prices up for the cars they do have available.

Close-up view of damage to a vehicle after a crash.

Krasula // Shutterstock

Traffic accident increases

Traffic accidents and roadway fatalities are seeing an unfortunate upward trend. Between 2020 and 2021, fatalities resulting from automotive collisions spiked by 10%. A greater share of those deaths was seen on urban as opposed to rural roads in 2021, according to the National Highway Traffic Safety Administration.

And the spike in deaths and accidents comes as medical care costs are also rising. The average cost of medical care increased 6.5% from October 2020 to October 2022, the most recent month for which data is available from the Bureau of Labor Statistics.

A line chart showing the average car insurance claim loss fluctuating over time, ending on a high in 2021.

The General

Rising claims and costs

These factors combine to generate deeper losses for insurance companies in 2021 than any other year in the preceding decade. Not only are costs per claim going up, but comprehensive damage claims are being filed more frequently, according to the Insurance Information Institute. That coverage insures a vehicle against forms of damage not related to a collision, like storms.

Aerial view of traffic backed up at an intersection.

e2dan // Shutterstock

More mobility

Following the easing of lockdowns and other COVID-19-related restrictions, Americans started traveling a whole lot more. To the dismay of airlines, interstate business travelers have not returned to the skies very quickly. By contrast, travel by automobile—whether road trips to visit family or for leisure, and even commuting to work—picked up quickly. That trend is especially apparent in travel for retail and recreational reasons, which was down 16% from pre-pandemic levels in October 2020 but was just 9% down from those levels in October 2022, according to Google mobility data.

This story originally appeared on The General and was produced and
distributed in partnership with Stacker Studio.

Share this:
Continue Reading

Business

5 tech advancements sports venues have added since your last event

Published

on

By

Uniqode compiled a list of technologies adopted by stadiums, arenas, and other major sporting venues in the past few years.
Share this:

In today’s digital climate, consuming sports has never been easier. Thanks to a plethora of streaming sites, alternative broadcasts, and advancements to home entertainment systems, the average fan has myriad options to watch and learn about their favorite teams at the touch of a button—all without ever having to leave the couch.

As a result, more and more sports venues have committed to improving and modernizing their facilities and fan experiences to compete with at-home audiences. Consider using mobile ticketing and parking passes, self-service kiosks for entry and ordering food, enhanced video boards, and jumbotrons that supply data analytics and high-definition replays. These innovations and upgrades are meant to draw more revenue and attract various sponsored partners. They also deliver unique and convenient in-person experiences that rival and outmatch traditional ways of enjoying games.

In Los Angeles, the Rams and Chargers’ SoFi Stadium has become the gold standard for football venues. It’s an architectural wonder with closer views, enhanced hospitality, and a translucent roof that cools the stadium’s internal temperature. 

The Texas Rangers’ ballpark, Globe Life Field, added field-level suites and lounges that resemble the look and feel of a sports bar. Meanwhile, the Los Angeles Clippers are building a new arena (in addition to retail space, team offices, and an outdoor public plaza) that will seat 18,000 people and feature a fan section called The Wall, which will regulate attire and rooting interest.

It’s no longer acceptable to operate with old-school facilities and technology. Just look at Commanders Field (formerly FedExField), home of the Washington Commanders, which has faced criticism for its faulty barriers, leaking ceilings, poor food options, and long lines. Understandably, the team has been attempting to find a new location to build a state-of-the-art stadium and keep up with the demand for high-end amenities.

As more organizations audit their stadiums and arenas and keep up with technological innovations, Uniqode compiled a list of the latest tech advancements to coax—and keep—fans inside venues.


A person using the new walk out technology with a palm scan.

Jeff Gritchen/MediaNews Group/Orange County Register // Getty Images

Just Walk Out technology

After successfully installing its first cashierless grocery store in 2020, Amazon has continued to put its tracking technology into practice.

In 2023, the Seahawks incorporated Just Walk Out technology at various merchandise stores throughout Lumen Field, allowing fans to purchase items with a swipe and scan of their palms.

The radio-frequency identification system, which involves overhead cameras and computer vision, is a substitute for cashiers and eliminates long lines. 

RFID is now found in a handful of stadiums and arenas nationwide. These stores have already curbed checkout wait times, eliminated theft, and freed up workers to assist shoppers, according to Jon Jenkins, vice president of Just Walk Out tech.

A fan presenting a digital ticket at a kiosk.

Billie Weiss/Boston Red Sox // Getty Images

Self-serve kiosks

In the same vein as Amazon’s self-scanning technology, self-serve kiosks have become a more integrated part of professional stadiums and arenas over the last few years. Some of these function as top-tier vending machines with canned beers and nonalcoholic drinks, shuffling lines quicker with virtual bartenders capable of spinning cocktails and mixed drinks.

The kiosks extend past beverages, as many college and professional venues have started using them to scan printed and digital tickets for more efficient entrance. It’s an effort to cut down lines and limit the more tedious aspects of in-person attendance, and it’s led various competing kiosk brands to provide their specific conveniences.

A family eating food in a stadium.

Kyle Rivas // Getty Images

Mobile ordering

Is there anything worse than navigating the concourse for food and alcohol and subsequently missing a go-ahead home run, clutch double play, or diving catch?

Within the last few years, more stadiums have eliminated those worries thanks to contactless mobile ordering. Fans can select food and drink items online on their phones to be delivered right to their seats. Nearly half of consumers said mobile app ordering would influence them to make more restaurant purchases, according to a 2020 study at PYMNTS. Another study showed a 22% increase in order size.

Many venues, including Yankee Stadium, have taken notice and now offer personalized deliveries in certain sections and established mobile order pick-up zones throughout the ballpark.

A fan walking past a QR code sign in a seating area.

Darrian Traynor // Getty Images

QR codes at seats

Need to remember a player’s name? Want to look up an opponent’s statistics at halftime? The team at Digital Seat Media has you covered.

Thus far, the company has added seat tags to more than 50 venues—including two NFL stadiums—with QR codes to promote more engagement with the product on the field.  After scanning the code, fans can access augmented reality features, look up rosters and scores, participate in sponsorship integrations, and answer fan polls on the mobile platform.

Analysts introducing AI technology at a sports conference.

Boris Streubel/Getty Images for DFL // Getty Images

Real-time data analytics and generative AI

As more venues look to reinvigorate the in-stadium experience, some have started using generative artificial intelligence and real-time data analytics.  Though not used widely yet, generative AI tools can create new content—text, imagery, or music—in conjunction with the game, providing updates, instant replays, and location-based dining suggestions

Last year, the Masters golf tournament even began including AI score projections in its mobile app. Real-time data is streamlining various stadium pitfalls, allowing operation managers to monitor staffing issues at busy food spots, adjust parking flows, and alert custodians to dirty or damaged bathrooms. The data also helps with security measures. Open up an app at a venue like the Honda Center in Anaheim, California, and report safety issues or belligerent fans to help better target disruptions and preserve an enjoyable experience.

Story editing by Nicole Caldwell. Copy editing by Paris Close. Photo selection by Lacy Kerrick.

This story originally appeared on Uniqode and was produced and
distributed in partnership with Stacker Studio.

Share this:
Continue Reading

Business

Import costs in these industries are keeping prices high

Published

on

By

Machinery Partner used Bureau of Labor Statistics data to identify the soaring import costs that have translated to higher costs for Americans.  
Share this:

Inflation has cooled substantially, but Americans are still feeling the strain of sky-high prices. Consumers have to spend more on the same products, from the grocery store to the gas pump, than ever before.

Increased import costs are part of the problem. The U.S. is the largest goods importer in the world, bringing in $3.2 trillion in 2022. Import costs rose dramatically in 2021 and 2022 due to shipping constraints, world events, and other supply chain interruptions and cost pressures. At the June 2022 peak, import costs for all commodities were up 18.6% compared to January 2020.

While import costs have since fallen most months—helping to lower inflation—they remain nearly 12% above what they were in 2020. And beginning in 2024, import costs began to rise again, with January seeing the highest one-month increase since March 2022.

Machinery Partner used Bureau of Labor Statistics data to identify the soaring import costs that have translated to higher costs for Americans. Imports in a few industries have had an outsized impact, helping drive some of the overall spikes. Crop production, primary metal manufacturing, petroleum and coal product manufacturing, and oil and gas extraction were the worst offenders, with costs for each industry remaining at least 20% above 2020.


A multiline chart showing the change in import costs in four major product industries.

Machinery Partner

Imports related to crops, oil, and metals are keeping costs up

At the mid-2022 peak, import costs related to oil, gas, petroleum, and coal products had the highest increases, doubling their pre-pandemic costs. Oil prices went up globally as leaders anticipated supply disruptions from the conflict in Ukraine. The U.S. and other allied countries put limits on Russian revenues from oil sales through a price cap of oil, gas, and coal from the country, which was enacted in 2022.

This activity around the world’s second-largest oil producer pushed prices up throughout the market and intensified fluctuations in crude oil prices. Previously, the U.S. had imported hundreds of thousands of oil barrels from Russia per day, making the country a leading source of U.S. oil. In turn, the ban affected costs in the U.S. beyond what occurred in the global economy.

Americans felt this at the pump—with gasoline prices surging 60% for consumers year-over-year in June 2022 and remaining elevated to this day—but also throughout the economy, as the entire supply chain has dealt with higher gas, oil, and coal prices.

Some of the pressure from petroleum and oil has shifted to new industries: crop production and primary metal manufacturing. In each of these sectors, import costs in January were up about 40% from 2020.

Primary metal manufacturing experienced record import price growth in 2021, which continued into early 2022. The subsequent monthly and yearly drops have not been substantial enough to bring costs down to pre-COVID levels. Bureau of Labor Statistics reporting shows that increasing alumina and aluminum production prices had the most significant influence on primary metal import prices. Aluminum is widely used in consumer products, from cars and parts to canned beverages, which in turn inflated rapidly.

Aluminum was in short supply in early 2022 after high energy costs—i.e., gas—led to production cuts in Europe, driving aluminum prices to a 13-year high. The U.S. also imposes tariffs on aluminum imports, which were implemented in 2018 to cut down on overcapacity and promote U.S. aluminum production. Suppliers, including Canada, Mexico, and European Union countries, have exemptions, but the tax still adds cost to imports.

U.S. agricultural imports have expanded in recent decades, with most products coming from Canada, Mexico, the EU, and South America. Common agricultural imports include fruits and vegetables—especially those that are tropical or out-of-season—as well as nuts, coffee, spices, and beverages. Turmoil with Russia was again a large contributor to cost increases in agricultural trade, alongside extreme weather events and disruptions in the supply chain. Americans felt these price hikes directly at the grocery store.

The U.S. imports significantly more than it exports, and added costs to those imports are felt far beyond its ports. If import prices continue to rise, overall inflation would likely follow, pushing already high prices even further for American consumers.

Story editing by Shannon Luders-Manuel. Copy editing by Kristen Wegrzyn.

This story originally appeared on Machinery Partner and was produced and
distributed in partnership with Stacker Studio.

Share this:
Continue Reading

Business

The states where people pay the most in car insurance premiums

Published

on

By

Cheap Insurance compiled a ranking of the states where people pay the most in full-coverage car insurance premiums using MarketWatch data.
Share this:

Nearly every state requires drivers to carry car insurance, but the laws vary, and many factors affect the cost of coverage.

Some are controllable, at least to degrees: the type of car you have and your credit history. Some are not: your age and gender. Your marital status, place of residence, and claims history are among the other variables that go into it.

Across the United States, premiums are soaring, rising 20% year over year and increasing six times faster than consumer prices overall as of December 2023, CBS reported. Last September, CNN noted that car insurance rates jumped more in the previous year than they had since 1976.

CBS pointed to many potential reasons for these increases in prices. Coronavirus pandemic-era issues have made buying, fixing, and replacing vehicles costlier. Extreme weather events caused by climate change also damage more vehicles, while insurance companies are increasing their business costs. Severe and more frequent crashes are to blame as well, CNN reported.

On top of these, local factors such as population density, the number of uninsured drivers, and the frequency of insurance claims all affect premiums, which can lead motorists to change or switch their coverage, use other modes of transportation, or even alter decisions about when to buy a vehicle or what to look for.

To see how geography affects cost, Cheap Insurance mapped the states where people pay the most in car insurance premiums using MarketWatch data. Premium estimates were based on full-coverage car insurance for a 35-year-old driver with good credit and a clean driving record. Data accurate as of February 2024.


A heat map showing full-coverage car insurance premiums across the US

Cheap Insurance

Americans pay $167 per month on average for full-coverage insurance

There are common denominators among the five states where it’s most expensive to have car insurance: Michigan, Florida, Louisiana, Nevada, and Kentucky. Washington D.C. is another pricey locale, ranking #4 overall.

Three of these six are no-fault jurisdictions and require additional coverage beyond coverage to pay for medical costs. Michigan notably calls for $250,000 in personal injury protection (though people with Medicaid and Medicare may qualify for lower limits), $1 million in personal property insurance for damage done by your car in Michigan, and residual bodily injury and property damage liability that starts at $250,000 for a person harmed in an accident.

Other commonalities between these states include high urban population densities. At least 9 in 10 people in Nevada, Florida, and Washington D.C. live in cities and urban areas, which leads to more crashes and thefts and high rates of uninsured drivers and lawsuits. Additionally, Louisiana, Florida, and Kentucky rank #5, #8, and #10, respectively, in motor vehicle crash deaths per 100 million vehicle miles traveled in 2021 based on Department of Transportation data analyzed by the Insurance Institute for Highway Safety.

A highway in Louisville.

Canva

#5. Kentucky

– Monthly full-coverage insurance: $210
– Monthly liability insurance: $57

A car driving through the desert and mountain scenery in Nevada.

Canva

#4. Nevada

– Monthly full-coverage insurance: $232
– Monthly liability insurance: $107

Cars parked on a street in New Orleans.

Canva

#3. Louisiana

– Monthly full-coverage insurance: $253
– Monthly liability insurance: $77

A bridge over turquoise water.

Canva

#2. Florida

– Monthly full-coverage insurance: $270
– Monthly liability insurance: $115

A truck on a highway surrounded by Fall foliage.

Canva

#1. Michigan

– Monthly full-coverage insurance: $304
– Monthly liability insurance: $113

Story editing by Carren Jao. Copy editing by Paris Close. Photo selection by Lacy Kerrick.

This story originally appeared on Cheap Insurance and was produced and
distributed in partnership with Stacker Studio.

Share this:
Continue Reading

Featured