Drivers everywhere continue to enjoy the benefits of low gas prices, and what are they doing to celebrate? They are driving more. It?s less costly to take a road trip now, rather than fly to another destination, so more drivers are taking to the streets. More cars on the road increase the number of traffic crashes which, in turn, translates into higher auto insurance rates.
Insurance rates are the cost of claims ? and if the cost of individual claims rises and the number of claims rise, so must insurance to cover those increased costs. In 2012, the Florida Legislature passed reforms to the state?s no-fault auto insurance law, which were intended to reduce some of the fraud and abuse that led to higher rates. The reforms did work, as both the frequency of claims and the average cost of each claim dropped steadily ? until the first part of 2015 when they started trending upward again. The timing of the uptick is no coincidence, and there are two causes: rising employment and falling gas prices. In January of 2015, gasoline prices were the lowest they?ve been in six years. The numbers of people in the workforce is also on the rise. More people working and driving means more collisions.
An opinion column says traffic accidents are on the rise and distractions are to blame. The National Safety Council estimated that motor-vehicle deaths in Florida for 2015 increased 18 percent compared to 2014. Florida crash statistics for the first quarter of this year are 13 percent higher than the same time period in 2015.
Our major cities seem to be increasingly congested. The bigger the county, the higher number of distracted driving crashes. Insurance rates reflect that trend.