Auto Insurance Rates Increasing
2016 was a tough year for auto insurance companies. State Farm, for example, lost 7 BILLION DOLLARS!!!! You are probably seeing your own auto insurance rates increase because of this. Insurance Companies are being forced to raise rates because they are paying out more for claims than they predicted. The article below from Bloomberg details how State Farm is being impacted by a 7 billion dollar loss due to high claims:
“State Farm to Displace 4,200 Workers, Exit 11 Locations – Bloomberg
State Farm Mutual Automobile Insurance Co., the largest U.S. home and auto insurer, plans to shut 11 U.S. facilities, displacing about 4,200 workers, after a $7 billion annual underwriting loss last year on auto policies.
The insurer will exit Parsippany, New Jersey, and Petaluma, California, in 2018 and the other locations by 2021, the Bloomington, Illinois-based company said Thursday in a statement on its website. The work will move to the headquarters and offices in cities including Atlanta, Dallas and Phoenix. The company said employees in affected facilities will have opportunities at other State Farm locations.
State Farm, Allstate Corp., Hartford Financial Services Group Inc. and Warren Buffett’s Berkshire Hathaway Inc. are among companies that have been burned in recent years by higher claims expenses from car crashes as more drivers are distracted by electronic devices. Higher repair costs have also hurt in an era when drivers are logging more miles behind the wheel. Companies have been charging more for coverage and looking for ways to reduce costs.”
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