Why Is Auto Insurance in Florida So Expensive?

Panama City Beach, Florida, view of Front Beach Road at sunrise
Panama City Beach, Florida, view of Front Beach Road at sunrise

Since the summer of 2022, the national average cost for auto insurance has seen an increase of 17% due to the corresponding increased frequency of accidents. However, residents in the state of Florida have been seeing the prices for auto insurance rise, regardless of how spotless their driving record is.

The Nationwide Increase In Insurance Costs

According to the American Property and Casualty Insurance Association (APCIA), the national average cost of vehicle damage claims have gone up by almost 50%, as well as a 40% increase of bodily injury claims between 2018 and 2022. With the high numbers of auto incidents resulting of distracted driving, there have been over 420,000 crashes, 1,000 auto-related deaths, and $10 billion in reported damages in 2022.

More accidents lead to more insurance claims. This causes many of these claims to result in lawsuits that, by extension, drive up the cost of insurance.

Why Is Auto Insurance In Florida Higher Than the National Average?

But what is it about Florida that has its residents paying more for auto insurance more than the rest of the country? According to the Tampa Bay Times, there are a number of unique factors specific to the state that has been driving up the cost of insurance. Hurricane damage, the higher rate of uninsured drivers (an estimated 20.4%), high car theft, and high amounts of fraudulent claims are among some of the bigger reasons for heightened auto coverage.

Overall crime is a significant factor behind Florida’s higher insurance rates. Recently authorities discovered 32 submerged vehicles at the bottom of a lake during a missing person cold case.

Florida has the 4th-highest auto theft rate in the U.S. There were 45,973 vehicles reported stolen in Florida in 2022. That is a 6% increase in the number of thefts in 2021.

There is also a large number of fraudulent insurance claims in the state of Florida, with many of them being pre-planned accidents and windshield replacement scams. In 2022, there were 33,196 reported windshield replacement lawsuits, with many of them being schemes. There has also been an average of 50,000 lawsuits from drivers being filed each month.

According to Nerd Wallet, the average annual cost for insurance in Florida is $3,605, or $300 per month. For many, the monthly cost of insurance is greater than the payments they are making on an auto loan.

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