Is there any truth to stories that rates on auto insurance have dropped in the United States in the last few years?


Premiums on auto insurance have been the lowest in May 2009 since September of last year. In September of 2008, rates rose to $1,950 and fell to $1,871 last May. This falling off was caused by the decrease in rates in the last three years. Even states with high premiums such as Florida and New York have also experienced a drop in auto rates.

There are several factors that have caused the fall in rates: aging population, production of cars with more safety devices like air bags and anti-lock brake systems, a drop in crime rates, drunk-driving laws being toughened, and a rise in auto-insurance competition.

With world recession practically showing no signs of abating, people try to save money. The fall in auto insurance rates is another way for people to cut down on expenses. Ironically, decreased car insurance rates are not much reason for the insurance industry to worry, since auto sales may rise by nine percent this month. Car dealers want the 2009 models taken from the display lots to give room for the 2010 models.

With people buying new vehicles, the need for updated car insurance policies and new auto plans will follow. A rise in car sales means a rise in car insurance purchases. A new vehicle may alter insurance premiums, so a car owner should shop for quotes from several companies for the best possible deal.

It is also a time to be very careful – like making sure that you only drive if you have auto insurance. Studies have shown that one in every six drivers in America could be driving without car insurance by next year. This is mainly due to the bad state of the economy. This is also a major reason for the fall in insurance rates, a way for insurers to get people back to buy insurance.