Severe Weather Spurs Rising Auto Insurance Costs | Insurify
Nowadays, all it takes is one hailstorm to cause a
A cracked windshield on a newer vehicle means auto technicians have to do more than just replace the glass. Features like rain-sensing wipers, forward collision warning, and heads-up displays triple the cost of what might once have been a $300–$500 repair, according to
Insurers have long considered regional factors, including weather, when calculating auto premiums, according to the
Hurricanes and severe storms drive damage losses
While most people are familiar with the kind of damage a hurricane can cause, severe thunderstorms happen much more frequently, according to property insights company CoreLogic.
Severe thunderstorms can include hail, strong straight-line winds, and tornadoes. And, while the insurance industry typically considers such storms more of a threat to homes and buildings, hail and strong winds can also cause expensive vehicle damage. Hail-related auto claims rose 12% in 2023 and are 22% more costly to repair than the average comprehensive claim, according to tech insights company
"Extreme weather events are increasing in severity, becoming major disruptors in the auto claims and repair industry,"
In the last five years, insurance companies in
Severe thunderstorms have also caused significant physical auto damage losses in upper Midwestern states, including
2024 insurance increases in states with highest rise in hailstorms
The factors making each claim more expensive
The "comprehensive" part of a standard auto policy covers physical vehicle damage from weather, like hail, flooding, fire, or a tree falling during a windstorm.
"With claims costs rising, any time a driver files an auto insurance claim to cover damage, insurers are paying out more money," said
Multiple factors contribute to higher claims costs, including continued inflation on auto parts, a shortage of auto technicians, and increasingly high-tech vehicles. Total repair costs for cars manufactured in 2021 were 15–19% higher than cars made in 2015, according to CCC.
Excessive or fraudulent personal injury lawsuits can also lead to higher premiums, according to
"Any factor that causes an increase in claims can affect auto insurance rates," Leach said. "So, more frequent and intense weather could cause more comprehensive coverage claims, increasing regional risk and affecting premiums."
Vehicle prices have climbed quickly. New cars are nearly
What's next: Despite rising repair costs, rate hikes are slowing
Research shows the auto insurance industry is recovering from record losses in 2022, according to Insurify's auto insurance report. Insurify projects car insurance costs will increase another 5% in 2025, a much lower rate than the 42% climb since 2022.
Average premiums decreased in 21 U.S. states in the second half of 2024, according to Insurify data.
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