Auto insurance rates will rise in 2022, regardless of COVID-19

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No matter what the pandemic decides to do this year, drivers will be paying more than in 2021.

Auto insurance rates were broadly discounted, refunded and otherwise reduced over the last couple of years, starting in 2020 when the pandemic began and sent employees home to work remotely or, in less fortunate cases to be furloughed or laid off.

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The lack of drivers on roads meant that the risk of crashes decreased, reducing the cost to insure vehicles.

As it became clear that it was less costly to insure people’s vehicles, auto insurance rates were decreased, discounted, or premiums were in part refunded by many insurers across the country. When companies started bringing their employees back in to their brick-and-mortar locations, traffic levels nearly returned to pre-pandemic levels in many areas. Still, as drivers continued to accumulate fewer miles than they used to, premiums in 2021 remained low or increased only slightly.

This year, however, will not see the same reductions. Even as the Omicron virus variant causes infection numbers to skyrocket and many businesses once again send workers home to do their jobs remotely, it isn’t expected that insurers will be issuing discounts once again unless the country starts implementing full-force lockdowns once more.

Auto insurance rates - US Increase cost

Instead, it is more likely that auto insurance rates across the country will see a slight increase.

A recent Forbes report indicated that there will be an average rise across the country of about 0.6 percent this year. There will be 22 states that will experience an average increase higher than 1 percent. The states expected to have the highest increases are Nebraska at 4.4 percent, and Minnesota at 2.5 percent.

Still, there will be 14 states that will see slight declines, even if they are moving against the country-wide trend. Among those states, the average decrease will be 1.7 percent when compared to what was paid in 2021.

The Forbes report cited the Quadrant Information Services’ State of Auto Insurance in 2022 report, which is conducted annually for the ValuePenguin consumer finance website. That report bases its auto insurance rates statistics on an analysis of 15 million quotes from 72 providers for various drivers across 35,000 Zip Codes.

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