Insurance giant ups state auto coverage rates – again

Insurance giant ups state auto coverage rates – again | Insurance Business

Insurance giant ups state auto coverage rates – again
State Farm is hiking auto insurance rates in Illinois an average of 2.2% starting in September, according to a report by chicagobusiness.com. The new hike follows an October rate adjustment that was the largest rate rise in more than a decade.

Together with October’s 5.8% rate bump, the new hike will mean that State Farm customers will see an average 8% price increase in under a year. State Farm insures about one in every three drivers in the state.

The company defended its decision to raise rates yet again.

“Claims costs continue to rise in Illinois, and have been rising for several years,” spokeswoman Missy Dundov told chicagobusiness.com in an email. The company justified its rate hikes by citing a spike in accidents caused in large part by distracted driving.

“Our concern (about distracted driving) has grown, as it has likely become a greater loss exposure,” Dundov told chicagobusiness.com. “Increased phone usage, enhanced technology and various other distractions now accessible or available in vehicles are all contributing factors.”

Last year, State Farm posted the biggest nationwide auto-underwriting loss in its history, chicagobusiness.com reported.