Auto Insurance Rates Increases in Florida (2022)

In the last five years, Florida has seen above-average increases in auto insurance rates. In this article, we will provide an overview of Florida car insurance rate increases as well as explain what Floridians can do to save money.

Since 2015, Florida drivers have seen above-average increases in their auto insurance bills. The average rate increase per year was about 3.5 percent, though some companies increased premiums by as much as 22 percent in a single year.

Car insurance rate increases in Florida

Auto insurance rates in Florida have risen by an average of 23% since 2015, outpacing the national increase of 17% during the same time period. Almost every major company in Florida has raised rates significantly in the last six years. The largest increases were seen by USAA, Liberty Mutual, and American Family, which ranged from 43 percent to 44 percent over a six-year period.

Progressive had by far the smallest increase, with a total increase of only 3.6 percent since 2015.

While the majority of car insurance companies raise their rates every year, the amount varies. This is why, whenever you go to buy insurance, we recommend getting three or more quotes. For example, despite raising rates by 35% in Florida since 2015, Geico remains one of the state's most affordable insurers.

How Florida's car insurance rates compare to other states

Florida had the fifth-highest increase in car insurance rates among all 50 states since 2015. In general, states in the South and the mountain region experienced some of the highest rate increases: nine of the ten states experiencing the highest increases are located in these two regions. Georgia and Colorado both had the highest cumulative increases in the country, at 29 percent.

Why car insurance rates have gotten so high in Florida

The short answer is that car insurance costs in Florida have risen due to an increase in the frequency and cost of car insurance claims. Because the majority of the money you spend on car insurance goes toward paying other people's claims, if more drivers file car insurance claims, your rates will almost certainly rise as a result.

Why rates are increasing in Florida

Natural disasters

Florida is more vulnerable to natural disasters than most other states due to its location on the Gulf Coast. According to NOAA, Florida has been the site of 23% of all billion-dollar disasters (adjusted for inflation) in the United States since 1980.

Furthermore, the frequency of these costly disasters has increased over time: there have been 21 such disasters in Florida since 2016, compared to only six between 2010 and 2015.

Natural disasters such as hurricanes, tropical cyclones, and floods increase insurance costs because car insurance, specifically comprehensive coverage, pays when these events damage your vehicle. If your car is damaged by wind, hail, or flooding, you should be covered as long as you have comprehensive coverage. These costs, however, are ultimately passed on to your insurer and other drivers.

Uninsured drivers

As of 2019, Florida had one of the highest rates of uninsured drivers in the country, at 20%. This is significantly higher than the national average of 13% and ranks sixth overall.

Because of Florida's high rate of uninsured motorists, premiums for drivers who do have coverage are higher. That's because the 80 percent of drivers who have coverage will eventually pay for the accidents caused by the uninsured 20 percent, either through uninsured motorist coverage or collision coverage, if they have it, or out of their own pockets.

Why rates are increasing nationwide

Although some causes of increased rates are more common in Florida, there are some trends that apply regardless of where you live in the country.

Drivers returning to commuting, interstate travel after 2020 COVID-19 lull

Due to the coronavirus pandemic, people stayed at home in the spring of 2020, causing a drop in driving. As a result, crashes decreased, and insurance rates decreased as well; some insurers even offered refunds as a result of collecting more premiums than they needed.

However, as people returned to the office and began traveling across the country in 2021, road use resumed. According to the Department of Transportation, there was a 55 percent year-over-year increase in driving in April 2021, resulting in more accidents and claims.

Car prices (and repair costs) are rising nationwide

The average price of a new car has risen significantly in recent years, with Kelley Blue Book estimating that the average price in 2021 will be around $46,000. This represents a 39 percent increase since 2015.

Furthermore, the cost of car repair has risen across the country. According to LowCostInsurance, car repair and maintenance costs will more than double by 2020.

Cars that cost more at the dealership and more to repair after a collision increase the dollar amount of claims. Unfortunately, this is true even if you do not own a brand-new car. If you cause a collision with a Lexus, your insurer is still liable for the high repair costs.

What can Floridians do if their car insurance rates go up?

If you find that your car insurance is becoming increasingly expensive, there are a few key steps you can take to address the problem.

Check out rates at other insurers.

First, determine whether there are any less expensive options for your coverage. Only 25% of Floridians with auto policies have shopped for new insurance in the last three years, according to Nielsen survey data.

We recommend that drivers look for a new policy every year or so. Drivers in Miami, for example, may see annual rates vary by several thousand dollars. There's no way to know if your current policy is overpriced unless you take the time to shop around every now and then.

Make sure you're only paying for coverage you need

Another way to save money on auto insurance is to adjust the limits of your coverage. A car that is more than ten years old or worth less than $3,000, for example, probably does not require comprehensive or collision insurance because the cost of your insurance will be greater than the declining value of your vehicle. By dropping comprehensive and collision coverage, you can significantly reduce your insurance costs.

You should also consider the limits of your liability coverage. Check to see if they make sense in light of your assets and the likelihood of you being involved in a lawsuit. If you are confident in your ability to drive safely and want to prioritize savings, you may want to increase your liability limits to meet Florida's minimum requirements.

Apply for discounts from your insurer

Another simple way to save money on auto insurance is to take advantage of discounts. There are defensive driving courses in Florida that can save you 5% to 10% on your insurance premium. Another example is the good student discount, which allows drivers with children who have at least a 3.0 GPA to receive a 10% discount.

Methodology

By analyzing rate changes filed by Florida auto insurers, we determined the typical historical rate increases for Florida drivers. The statewide averages are based on insurer market share in 2020.

Additional resources include:

Insurance Information Institute of Kelley Blue Book Nielsen National Oceanic and Atmospheric Administration U.S. Department of Transportation