Reports from Albany, New York paint a bad news-good news story as New Yorkers continue to pay the third most expensive amount in the US for auto policy premiums despite the fact that car insurance rates in the state continue to go down.
Sources say that contradicting news and information about New York premium rates is nothing new to New Yorkers as this phenomenon seems to be happening year after year. According to the annual report published by the National Association of Insurance Commissioners, back in 2007, average premium rates paid by New York drivers was $1,179.
The year before that, during 2006, average spending for car insurance was 2.8% lower since an average driver only spends $1,213 per insured vehicle. When compared with national average of $912 back in 2006, New York average of $1,213 seems a lot. Experts are now starting to believe that the premium trends in New York is a natural occurrence in the insurance industry – some states enjoy a directly proportional relationship between statewide premium decline and the average insurance expenditure of motorists. On the other hand, states like New Jersey and New York have an inverse relationship between the two, which explains the upward and downward figures in their auto insurance statistics.
Since 2003, New York’s premium rates have been dropping by approximately 5-10% per year. According 2009 statistics, New York enjoyed a 10.7% drop in rates from 2003 while the US as a whole reported a rate increase of 4.7%. According to Insurance Information Institute head Robert Hartwig, New Yorkers, given their extremely fast-paced lifestyles, are not bothered at all. He said in a recent interview that some are even happy about it, especially drivers that are weary about the recession. Industry insiders believe that Hartwig is referring to city drivers who compute for average daily expenses who will be happy about the relatively stable premium rates. This is even supported by a recently released statement made by Deputy State Insurance Superintendent Mike Morality, saying that many New Yorkers believe that the less volatility, the better. Morality adds that his team strives to make car insurance available for everyone, but more importantly, he aims for stability and consistency in premium charges.
New York Public Interest Research Group representative Russell Haven, said that auto policy expenditures in highly urbanized states such as New York are heading towards the right direction and will eventually get to that desired location; it just seemed to take a detour and did not use the expressway to affordable insurance.