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Car Insurance Premiums: Here’s Why They Keep Rising

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Cash resting on car insurance policy

If you feel like the price of everything has skyrocketed over the past year, you’re not alone. Prices for the wide range of consumer goods have ticked up incessantly. Unfortunately yours car insurance Premiums have not escaped this trend. You may not know it yet, however, as rate hikes usually apply when you renew your policy.

As with the economy in general, several factors conspire to drive up costs insure your car higher and higher. In fact, it’s a perfect storm of causes that drives up insurance rates. Here we will provide the evidence of rising interest rates and uncover many of those responsible. We’ll also take a quick look into the crystal ball to prepare you for what’s to come and share some tips on how to minimize the impact of rising insurance premiums.

Let’s do a little detective work and see what’s going on.

TIED TOGETHER: How to get car insurance: everything you need to know

Is car insurance getting more expensive?

In a word, yes. However, rate hikes are from state to state and insurance Forwarder for forwarder. When the smoke clears, however, the increases will affect almost every driver. Bankrate recently reported that auto insurance rates are increasing by an average of 4.9% nationwide.

Bankrate also reports that the average cost of comprehensive auto insurance at the time of writing is $1,771. At minimum coverage, the average drops to $545. Applying that 4.9% increase to those numbers, the average annual rate for full coverage is $1,858 and $572 for minimum coverage — but that’s not all. Read on to learn how much more car insurance costs are likely to increase.

What is comprehensive car insurance?

Each insurance company has their own definition of what comprehensive insurance is. However, most agree that it involves collisions, full, personal injury liability and property damage liability. Some companies may also include personal injury protection (PIP), uninsured motorists, and other coverages in their “full” definition.

What is the minimum coverage for car insurance?

Minimum coverage may vary by state and legal driving requirements. Sometimes it’s just about personal injury and property damage.

TIED TOGETHER: Penalties for driving without car insurance by state

Why is my car insurance going up?

While it may seem that the rising cost of new and used cars fully explains the increasing trends in auto insurance, several factors are responsible. We reached out to a data collection organization, the Insurance Information Institute (Triple-I), to get their take on spiking cars insurance costs. We were surprised by some findings.

With so many influences in play, it’s difficult to pinpoint exactly where the problem begins. All problems are somehow related. Consequently, it becomes “the chicken or the egg” when it comes to determining what causes what. However, below we list some factors.

TIED TOGETHER: Common auto insurance myths to avoid

Higher car prices

Prices for new cars and used cars are unusually high. Data from Kelley Blue Book mother Cox Automotive shows this average transaction price for new vehicles in August 2022 compared to August 2021 increased by 10.8% yoy. The average transaction price for new vehicles in the Kelley Blue Book in the US increased to $48,301, up $4,712 from 12 months earlier.

used car prices also shot up. Kelley Blue Book closely monitors the prices buyers pay for used cars. There’s a little magic in comparing prices year-on-year. It’s not quite an exact science. The good news is that used car prices fell measurably year-on-year from March to June 2022. However, they are still more than 11% higher than a year ago.

Summary: The economics of these staggering increases in insurance costs are fairly simple. As vehicle prices increase, so do the cost to insure them.

Higher cost of auto parts

Increased demand (see below), supply chain failures and escalating metal costs are the “hat trick” of rising spare parts costs. These costs add to the cost of repairing a damaged car, driving up insurance bills. By some estimates, the cost of auto parts has increased between 7% and 20% this year alone.

However, the problem does not end with the increase in the cost of common spare parts. Today’s new cars are packed with increasingly sophisticated technologies and systems. Replacing high-tech components adds another layer of cost to the repair equation.

Summary: The cost of auto parts rose this year, contributing to insurance carrier losses.

Increase in car accidents and fatalities

According to Triple-I, the second quarter of 2022 was the fourth consecutive quarter of rising traffic accidents, injuries and fatalities. More claims result in greater losses for insurance carriers. In addition, as traffic accidents become more frequent and serious, the involvement of lawyers increases. In fact, there has been a large increase in liability claims.

Dale Porfilio, Triple-I’s chief insurance officer, said more lawsuits mean higher insurance payouts and higher premiums. “Increased liability losses may be due to increased litigation as courts reopen as the COVID-19 pandemic abates,” he said.

Summary: The frequency and severity of accidents continues to increase, resulting in more litigation and higher liability regimes.

Comprehensive demands are increasing

Your comprehensive insurance covers damage from natural disasters, burglary, vandalism and theft. For example, the claims for catalytic converter thefts are on the rise nationwide. Each catalyst contains between $20 and $240 in rare metals, making them a popular target for thieves. Replacing the stolen converter and repairing any damage caused by a thief stealing it can result in an insurance claim of up to $3,000 or more.

Summary: thefts and other sweeping demands are on the rise.

A broken supply chain

Bottlenecks in the supply chain do not directly affect insurance premiums. However, they affect the price of new cars and car parts.

It doesn’t matter much which point in the supply chain you’re examining; it’s not going well. There are many reasons for this — an exhausted workforce due to the COVID-19 pandemic, high fuel costs, and shifting demand. Add to that an over-reliance on “just-in-time” inventory management, leaving many industries vulnerable to a supply disruption of more than a few days. Many suppliers were down for months, not days. It’s been a catch-up game since then.

There is currently a shortage of truck drivers, port workers and cargo ships.

Summary: High car prices and expensive spare parts can at least partly be attributed to a broken supply chain.

Will your car insurance premium go up?

The news here is not good. In the past two years, the ratio of money auto insurance carriers pay out in claims to what they earn in premiums has grown. According to data from Triple-I, auto insurers paid out an average of about $0.93 for every dollar in premiums in 2020. This resulted in a payout of $1.02 for every award dollar received in 2021. For the second quarter of 2022, this ratio deteriorated even further to $1.05 paid for every award dollar received.

Based on the latest industry results, Triple I projects’ auto insurance rates need to increase another 5% to 10% over the next year.

TIED TOGETHER: Car Insurance Facts You May Not Know

5 steps to lower your car insurance premium

Just because you’re likely lined up for a hefty rate hike next year doesn’t mean you don’t have options. You can Take steps to reduce your premium also in view of the threat of increases.

  1. Shopping spree: Some insurance policies are simply more expensive than others. In this market you need to cut costs wherever you can. research. There’s definitely a better deal out there.
  2. Bundle your coverage: Many Insurers give discounts to customers if they have more than one policy with the company. Home and car insurance are two common policies that most companies bundle and discount.
  3. Increase in deductible: setting a higher deductible for damage almost always results in a lower premium. Discuss it with your insurance company to determine a deductible you can afford to pay out while lowering your rate.
  4. Reduce Coverage: This is a suggestion aimed at drivers of older cars. If your vehicle is older and paid off, you may consider reducing or eliminating accident insurance. The same applies to comprehensive insurance. Research yours current market value of the car. If book value is low, you might be better off putting those rewards into a savings account for a new ride.
  5. Maintain good credit: look at insurance companies Credit Scores when assessing a driver’s risk. A low credit score warns an insurer that you are more likely to make claims. This is especially true if you have a low or no deductible policy.

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Tesla Model 3 refresh coming with even more controls via the display, sources say

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Tesla developed a revised version of the model 3according to four people with knowledge of the effort as the leading EV maker aims to cut production costs and increase the appeal of the five-year-old electric sedan.

A focus of the redesign, codenamed “Highland,” is to reduce the component count and complexity inside the Model 3 while focusing on features that do Tesla Buyer value, including the display, according to people who asked not to be named because the revamp wasn’t announced.

The previously unannounced redesign comes as the electric sedan faces increasing competition from models such as of China BYD, Hyundai and upcoming releases from other major automakers.

The makeover of the battery-powered sedan, which could also include some changes to the Model 3’s exterior and powertrain performance, will go into production at Tesla‘s Shanghai factory and the company’s Fremont, California facility, two of the people said. TeslaShanghai Gigafactory will put the redesigned Model 3 into production in the third quarter of 2023, it said.

It was not clear when production would begin at the Fremont facility or what the cost savings would be Tesla from redesigning how it works with suppliers.

The effort highlights an approach to vehicle development pioneered by Tesla and is now being copied by other automakers, including Toyota Engine that eliminates complexity – and cost – in production.

There is also an example of a key project at Tesla that has even rolled ahead as Chief Executive Elon Musk has focused on its troubled takeover of Twitter in recent months, an area of ​​concern Tesla investors.

Tesla did not respond to a written request for comment from Reuters.

change you can see

The redesign for the Model 3 builds on the revision of the Model S Tesla‘s premium EV sedan – which was released last year. This redesign added an aircraft-style yoke in place of a traditional steering wheel, removing buttons and traditional air vents as part of a minimalist interior in which the centerpiece is a 17-inch electronic display.

the model 3, Tesla‘s cheapest electric vehicle, which starts at just under $47,000 in the United States, was the automaker’s best-seller but is being overtaken by the Model Y crossover. With only four models in production, the styling changes on each piece TeslaCompared to established car manufacturers, the product range of has an oversized importance.

Ed Kim, president of AutoPacific Group, which tracks market trends and production, said the current Model 3 has already been updated from the version that first went on sale in 2017 Tesla Update battery Power, information and entertainment opportunities through software, even if it still looks the same.

“Despite this, consumers still tend to equate visual change with novelty,” he said. “Tesla knows that visually tangible changes are coming.”

“The upcoming changes that potential customers can see and feel will be very important to ensure that EV customers still have Tesla at the top of their minds as really excellent alternatives too Tesla start to flood the market,” he said.

keep it simple

Musk has pushed a simplified approach to design and production Tesla that the Highland project is expanding, said those with knowledge of the development.

Tesla pioneered the use of massive casting machines known as the Giga Press, built by the IDRA Group in Italy to produce individual, larger parts of a vehicle in assembly, to reduce costs and acceleration Production. It has also developed a structural battery pack that eliminates the need for more expensive modules.

said Musk Tesla attempted to reduce costs by simplifying and working on a subcompact platform that would cost half the cost of the Model 3.

“Again and again we have found parts that are not needed. They were put there just in case or by mistake. We removed so many parts from a car that didn’t do anything,” Musk said in an interview at a Baron Funds conference earlier that month.

The approach is part of what has made Tesla the most profitable electric vehicle manufacturers, while many competitors are still at a loss. in the third quarter, Tesla made just over $9,500 in profit for each car sold, compared to around $1,300 for Toyota, according to the two companies.

The Model 3 makeover comes at a time when sales are under pressure in China, its second largest market after the United States. Sales of the Model 3 in China fell 9% year over year in the first decade, while BYD’s Qin and Han electric sedans outperformed the Model 3, according to the China Passenger Car Association.

To boost sales Tesla slashed Model 3 and Model Y prices in China by up to 9% in October and offered a premium Deduction for buyers that were delivered immediately.

Sam Fiorani tracking down Tesla and industry-wide production at Auto Forecast Solutions, said the upcoming changes to the Model 3 that he knew were coming showed the power of Tesla‘s approach to taking complexity out.

“They’re always looking for ways to make electric vehicles viable and even more profitable,” he said.

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BMW suggests you keep your old car for longer

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BMW has shown the potential to recycle older cars in greater numbers than today to reduce waste, rather than constantly buying new ones.

The idea was introduced there by Monika Dernai, head of BMW’s sustainability team, in a widely reported speech in London Auto Express.

“We really need to think about extending the lifespan of cars; You don’t have a used car market where you sell cars to each other, but maybe take a car and extend its lifespan,” Ms Dernai said.

“The idea might be that you could freshen up the interior,” she added, suggesting that reducing consumption is an important component in reducing our environmental impact.

“We need new skills in the aftermarket and to design cars so that the seat can be removed and a new seat put in – then it’s a used car that looks like a new car,” she added.

Whether their bosses at BMW love an idea that could reduce new car sales is another question entirely, but it would clearly reduce emissions. Building cars is an intensive process.

“It may have the same owner who then doesn’t buy a new car, but we still have a business model as a BMW and the whole of society benefits from it,” Ms Dernai claimed.

“Can we all switch to public transport? I think the answer is no. You’re worried about public transport in the UK, but when you look to the US it’s even more desolate. So I think there is still a market for cars out there.”

Upcycling is a burgeoning industry, but there’s a growing trend to electrify classics. The industry’s shift to over-the-air software updates also represents a paradigm shift in how long tomorrow’s car will stay shiny and new.

What do you think about this idea?

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2023 Genesis G70 Review, Pricing, and Specs

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overview

German automakers have ruled the entry-level luxury sedan segment longer than print magazines have been selling cigarette ads – but times have changed and the Korean-built Genesis G70 sedan is a red-hot contender. To compete against sporty sedans like that BMW 3 series The G70 is offered in two temperature settings: warm and hot. The base engine is a 252-hp turbocharged four-cylinder, but in the 365-hp V-6, the G70 transforms into an experience that’s about more than just comfort. Both drivetrains come standard with rear-wheel drive, but offer all-wheel drive for extra coin. Based on the same platform as the Rowdy Kia Stinger Sports sedan, the G70’s ride is controlled and as neat as the stitching on the seats. An affordable entry-level price, complemented by an excellent 10-year drivetrain warranty, makes the G70 a sensible choice with plenty of sporting benefits.

What’s new for 2023?

While the G70 just got a refresh last year, the affordable luxury sedan sees only subtle trim changes for 2023. The 2.0T Sport Prestige replaces the Prestige package, giving it different wheels, a dark grille, ventilated front seats, and shiny pedals. Genesis also added a Power Trunk for 3.3T Sport Prestige models. In the paint department, Siberian Ice and Mallorca Blue are only available until the end of 2022.

Prices and which to buy

Even the higher-end versions of the G70 represent good value compared to competing sport sedans, so we’d go for the Sport Prestige 3.3T model. Not only is the twin-turbo V-6 more powerful, in our testing it was almost as efficient as the base turbo-four. The Sport Prestige trim offers almost all of Genesis’ high-end features, including a head-up display, upgraded Brembo brakes, a 360-degree exterior camera system, Nappa leather upholstery, a heated steering wheel and a luxurious microfiber headliner.

engine, transmission and performance

The base G70 2.0T has a turbocharged 2.0-liter four-cylinder that sends 252 hp to the rear wheels via an eight-speed automatic transmission; All-wheel drive is optional. Its engine felt restrained around town, although its acceleration was peppy (60 mph in 5.8 seconds). However, our hearts skipped a beat when we got behind the wheel of the 3.3-liter, twin-turbocharged V6 model and its 365 ponies and 376 pound-feet of torque. We spent some personal time with the rear-wheel drive 3.3T and were pummeled by the engine’s thrust shaft, which sent it from zero to 60 mph in 4.7 seconds in our test. Regardless of powertrain configuration, the G70 has expertly balanced ride and handling characteristics. Its suspension compensates for bumps, and the sedan remains sovereign when cornering at high speed. The more powerful 3.3T has the benefit of adaptive dampers, allowing the driver to tighten the ride if needed, but every G70 we’ve driven has done so remarkable work Sending information to the driver’s hands. Its steering feedback is precise and pleasant, with adjustable effort available by toggling between the different driving modes.

Fuel consumption and MPG in the real world

According to the EPA, the most efficient G70 model is the rear-wheel drive version with the 2.0-liter turbocharged four-cylinder engine. This car received ratings of 22 mpg city, 30 mpg highway and 25 mpg combined. On our 200-mile highway fuel economy test, the four-cylinder G70 delivered 31 mpg; with the twin-turbo V-6 on board, we recorded an impressive 29mpg. For more information on the fuel economy of the G70, see the EPA website.

Interior, comfort and cargo

Inside, the G70 offers a luxurious experience thanks to attractive materials and excellent build quality. The driver-centric layout and uncomplicated controls will appeal to driving enthusiasts. Likewise, the classy luster work and decoratively stitched surfaces on our test car soothed our wealthy side. Genesis also keeps things classy, ​​avoiding the urge to plaster faux carbon fiber bits and a flat-bottomed steering wheel into the cabin, and the result is an interior that seems more luxurious than that Alfa Romeo Giulia‘s. While the front seat strikes a nice balance between comfort and sport, the rear seat is compromised by limited legroom. We managed to fit five carry-on bags in the G70’s trunk, and 14 total with the rear seats folded. Interior storage includes a useful compartment at the front of the center console, perfect for smartphones and other small items. Unfortunately, the door pockets are small, and the center console compartment lacks organization.

infotainment and connectivity

Every G70 comes standard with a 10.3-inch touchscreen infotainment system that juts out from the otherwise clean dashboard. The setup includes desirable features like Apple CarPlay and Android Auto capability. We’ll learn more about the 2022 G70’s infotainment offerings as the car’s sale date approaches.

Safety and driver assistance functions

The G70 has several standards driver assistance technologies, such as adaptive cruise control with stop-and-go technology and collision warning with automatic emergency braking. For more information on the G70’s crash test results, visit the National Highway Traffic Safety Administration (NHTSA) and Insurance Institute for Road Safety (IIHS) Web pages. Key security features include:

  • Standard automated emergency braking with pedestrian detection
  • Lane Departure Warning and Lane Departure Warning as standard
  • Standard adaptive cruise control

Warranty and Maintenance Coverage

genesis covers every G70 with an exceptional warranty and free scheduled maintenance. The luxury brand also offers a valet service – by appointment – where the vehicle is picked up and dropped off for service visits and a Genesis loaner model is made available for the interim period.

  • The limited warranty is 5 years or 60,000 miles
  • The powertrain warranty is 10 years or 100,000 miles
  • Free scheduled maintenance is covered for 3 years or 36,000 miles

specifications

specifications

2022 Genesis G70

VEHICLE TYPE
Front engine, rear or 4 wheel drive, 5 passenger, 4 door sedan

BASE PRICE
2.0T, $38,570; 2.0T AWD, $40,670; 3.3t, $43,145; 3.3T AWD, $45,245

ENGINES
Turbocharged and intercooled DOHC 16-valve 2.0-liter inline-4, 252 hp, 2 lb-ft; Twin turbocharged and intercooled DOHC 24-valve 3.3-liter V-6, 365 or 368 hp, 376 lb-ft

TRANSMISSION
8-speed automatic

DIMENSIONS
Wheelbase: 111.6 inches
Length: 184.4 inches
Width: 72.8 inches
Height: 55.1 inches
Passenger volume: 96 ft3
Trunk volume: 11 ft3
curb weight (CD est): 3700-4000lb

PERFOMANCE (CD EUROPEAN DAYLIGHT SAVING TIME)
60mph: 4.3-6.2s
100mph: 10.8-16.0s
1/4 mile: 12.9-14.9 sec
Top Speed: 145-167 mph

EPA FUEL ECONOMY
Combined/City/Highway: €20-24/€17-21/25-31 mpg

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