NBC 5 Responds has warned you that auto insurance premiums are going up industry wide. One Chicago man felt something was wrong when his annual rate increased by nearly 90%.
There aren't any accidents or tickets on Nathaniel Phillips’s driving record. The only part of his coverage that changed is the price.
“My premium was $1,290. That was for full coverage,” Phillips said, speaking of his first policy with Liberty Mutual. He switched to the company in 2022.
When his renewal came in the mail a few months ago, he was shocked to see the premium increased to $2,309. He tried to make sense of it.
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“I literally checked my policies and checked them side-by-side, everything remained the same,” Phillips said. He contacted his Liberty Mutual agent, who according to Phillips, told him the rate may have jumped because he didn’t bundle his auto policy with a homeowner’s policy.
According to Phillips, he asked his Liberty Mutual agent to follow up with him with a definitive reason for the increase. He said he never heard back, so he decided to call NBC 5 Responds.
“You guys are synonymous with consumer problems being resolved,” Phillips said. “And that's why I reached out to you all to see if you could intervene and give me some help.”
Local
NBC 5 Responds contacted Liberty Mutual about Phillips’s situation. The company said it could not speak to individual customer policies, but it did follow up with Phillips Directly. The company sent him a letter stating, in part: “Despite your exceptional driving record, there are external factors beyond your control that influence the overall cost of providing insurance coverage.” The letter from Liberty Mutual went on to say evolving market conditions, general trends in claims, and economic factors have led to his rate increase.
Phillips says he’s currently shopping around for a new insurance provider with lower premiums.
Rates Increasing Nationwide
According to Insurify, an insurance comparison shopping website, car insurance rates are increasing by an average of 7% in 2024.
“Recent loss trends and rising costs in Illinois have resulted in significantly higher losses than premiums collected,” the American Property Casualty Insurance Association said. “All indicators suggest that this period of high costs will continue in 2024 and potentially beyond.”
Calling for Change
Illinois State Representative Will Guzzardi recently introduced the “Motor Vehicle Insurance Fairness Act."
“The legislation would create what's called rate review, where if the car insurance companies want to raise your premiums, they have to go before the State Board of insurance and say, here's how much we want to raise them by. And here's why these are the factors that are causing us to raise the premiums, and the Department of Insurance could approve or reject those increases," Guzzardi said.
Rep. Guzzardi says the legislation has received support from both sides of the aisle.
Getting the Lowest Possible Rate
The American Property Casualty Insurance Association says you can get the lowest possible rate by:
- Raising your deductible to lower your monthly insurance premium.
- If you don't drive a lot of miles: consider a pay-as-you-drive policy that offers lower premiums.
- Ask your insurance agent about bundling discounts.
