Why are my Auto Insurance Rates Increasing in Utah?

Utah auto insurance rates will increase along with the rest of the nation in 2022 and we wanted to share a few of the reasons this is happening.  

First, we have not seen this level of inflation for many years.  Inflation is set to increase 7+% and that’s just an average, products like cars and car parts will increase even more.   

Folks are back to driving and Utah roads are busy.   During the pandemic many stayed home or worked from home and almost every auto insurance company reduced rates to reflect lower claims.  That has come to an end as people are anxious to get out again.  

People have not slowed back down.  During the pandemic commuting was amazing, I-15 and  I-215 were never easier to drive down even in rush hour.  We all became accustomed to higher speeds, myself included.   As folks have returned to the roads we have not slowed back down and that is causing accidents with higher severity.  

Another reason is the increased cost of used cars.   As cars have become more sophisticated the cost to repair these cars has gone up and more cars get totaled in an accident.  In Utah about 10% of the cars that are involved in a motor vehicle accident are total losses. That’s up from 8% just a few years ago.  Consumers are now paying up to 37% more for a used car and that means…..Insurance companies are as well.   The increased cost of a used car gets passed on in the form of higher insurance rates.  

For example, my wife inherited a 2003 Toyota Corolla with 60,000 miles in August of 2019.  She kept the car, drove it until October of 2021 adding 20,000 miles and sold the used car by word of mouth for $5000.00!!  A 2003 Corolla with 80,000 miles for $5000.00 that was worth perhaps $4000.00 two years prior.   20,000 miles + 2 years and the value of the car goes up over 20%, go figure.  

New cars have also increased in value.  Almost everyone is paying over retail price for a new car and waiting months for delivery.   The wait and price for a truck or luxury car is even greater.   The more expensive the car, the higher the cost of the insurance. 

In Utah we go through a lot of windshields.   At Anderson Insurance Group we have traditionally advised our customers to take higher deductibles and pay for windshields out of pocket keeping the overall cost of insurance down.   Windshields on newer cars in Utah can cost significantly more than the $500.00 deductibles that we have traditionally advised.  When a windshield has to be replaced all of the driver assistance sensors have to be recalibrated or are part of the windshield and that translates into higher cost.  Gone are the good ol’ days when a windshield cost $300.00.  

Increased labor costs.   Body shops in Utah are not immune to increased labor costs and the competition for talent is expensive.   If you want the best technicians working on your car, it will cost a little more.    

Supply Chain issues.   The auto repair industry has been hit as hard as any by supply chain issues.   There are fewer truckers and higher demand and that is driving up the cost of auto parts.  

Rental Car Costs.   If – you can even find a rental car, its going to be expensive, as much as double.   In addition, It takes longer for the body shop to fix your car while they are waiting for parts.  The two factors of cost + length of a rental are increasing costs for insurance companies and that gets passed onto the consumer.   

What can you do to reduce your Utah auto insurance?  

Give us a call and let’s take a look at your policy.  Inevitably all insurance company’s rates will increase and some will react faster than others.  Let’s take a look at the following strategies to save you some money:     

  1. Rescore your auto insurance policy. 
  2. Increase your deductibles. 
  3. Participate in telematics to reward responsible driving.  
  4. Package your home and auto insurance with same company. 

These are just a few things, call us for more information, we are always open to do what we can to keep costs down. 

Anderson Insurance Group – 801-262-1551 – www.anderson.insure   

Author Lance Anderson

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