Drivers get sticker shock over car insurance, some rates up 20%

OLYMPIA, Wash. - Washington state drivers are experiencing sticker shock after insurance rate increases that are, on average, higher than anything seen in the last few years. 

For the top 20 insurers, some of the rates have jumped more than 20%. 

The increases are not happening all at once, but when insurance renewals come up, people notice. 

Experts say that over the last few years, rate increases have been small and that's why recent, larger increases are so jarring.

"There has been an increase, and it’s impacting us for certain," said Brooke Anderson, a resident of Seattle. "It’s a big part of our budget and our life for sure. We just bought a new car, and that was a big part of the decision, and we have teenage kids."

Anderson and others say increases across the board have been noticeable. 

"With our house, cars and insurance, like all of that together, it’s barely affordable. Living in Seattle is tough," said Anderson. 

Insurance companies are required to file rate changes with the Office of the Insurance Commissioner in Washington for approval.

Communications Manager Aaron VanTuyl says over the last five years, base rates for auto insurance fluctuated by only 2 - 3 % one way or the other. However, they've since jumped into the double digits. 

"Last year, the average base rate change among the top 20 insurers in Washington state was about 24%," said VanTuyl.

He says the increase wasn't approved all at once. He describes it as the weighted average across all of the last year, from the 20 largest private passenger auto insurers in Washington, which account for about 78% of the business statewide. 

"It’s important to remember that during the five years before that, we didn’t really see much change at all," said VanTuyl. 

Looking at increases more broadly, he says it lines up nationally. 

"The expectation was, I think, an 18% increase in Washington for actual insurance costs, and nationwide they are up 13%. If you look at it that way, yes, they have increased faster in Washington, but in Washington State, that same report has our annual insurance costs as below the national average," he said. "So, we caught up a little bit to the rest of the country, but we are still in the lower half." 

VanTuyl says higher value cars, costly repairs and an increase in the severity of crashes from 2020 to 2022 have driven the increases. 

 "Cars cost more, and it costs more to repair them," he said. "Companies reported an increase in serious bodily injury and fatal auto accident claims over the past few years."

Seattle driver Chris Franke tells FOX 13 that he has USAA, which provides a value compared to what his friends pay out for insurance yearly. He estimates that it's a quarter of the cost. He feels reform is needed in the insurance industry. 

"Insurance is a bummer, it’s so expensive," said Franke. "I feel like we pay a lot of our income into it, and unfortunately, oftentimes, when we need them, I think they pay out as little as possible. I think they work pretty hard to pay out as little as possible. That’s their business model. So, it’s unfortunate. I think we need to reform how that all works." 

In June 2024, VanTuyl says a transparency rule will go into effect that is aimed at helping consumers. It will require insurers that raise their rates to explain why they are increasing costs if the customer asks for an explanation. 

VanTuyl says there is a consumer advocacy group within the Office of the Insurance Commissioner that can also help consumers get answers when needed.