State Farm Auto Rate Increase Florida
State Farm is again making headlines in Florida by announcing a statewide average rate increase for their auto insurance. The company will be increasing premiums by 9.2% for their Mutual customers and 11.8% for their Fire & Casualty customers. Most auto insurance companies have 2 different divisions, one for less-risky drivers and the other for more-risky. In State Farm's case, Mutual is the preferred company reserving the lowest rates for their clientele. These are generally drivers with no tickets or accidents in the past 3 years. If your driving record is not-so-perfect, chances are you will be placed in the Fire & Casualty company. If you manage to find yourself in this group, there are 3 tiers available; either 1 Star, 2 Star, or 3 Star. 1 being the most expensive and 3 the least. The more tickets and accidents one may have, the lower the star. State Farm isn't alone with their different companies for risk groups. Allstate has Allstate Insurance and Allstate P&C. Progressive has Progressive American and Progressive Select. GEICO has GEICO General and GEICO Indemnity.
State Farm isn't the only company to raise car insurance rates in Florida. Allstate has approved a 16% rate increase for their Fire & Casualty division beginning January 11, 2010. The average customer will experience an increase of $82 for their 6 month policy. The best way to combat these rate increases is to get auto insurance quotes from the leading companies on a semiannual basis.
According the Jack DcDermott of the Florida Office of Insurance Regulation (OIR), there is a growing trend in bodily injury claims. There also seems to be a greater number of PIP or Personal Injury Protection (Florida No-Fault) expenses, as well as fraud. Chris Neal, a spokesperson for State Farm, stated that since late 2005 until 2009 overall premiums for auto insurance have actually decreased 1%. However, the rising number of bodily injury and property damage claims, pip claims and fraud have led the largest insurer to begin raising rates. As the economy worsens, more people choose to commit insurance fraud to collect "free" money. In order for insurance companies to make up for these additional costs and fraud, insurance rates are rising nationwide.
McChristian of the Insurance Information Institute states Medical costs are rising 3.3% and the cost of auto body repair work is rising 3.7%. Florida is currently the fifth (5th) most expensive state for car insurance.
State Farm currently insures 2.7 million cars in Florida and is bigger than Allstate, Progressive, and GEICO combined in the state. Historically, the auto insurance marketplace has been extremely profitable here in Florida. This brought many competitors to our state, allowing Floridians to enjoy the benefit of the competition in the form of lower rates. Now with increasing expenses, more and more companies will be raising rates.
Andrea S. Jackson is a contributing author for MyFloridaInsurance.info, Florida's Insurance Blog. For the latest insurance news, information, and free online quotes around the state of Florida, click here=>
Article Source: ArticlesBase.com
