The Property Casualty Insurers Association of America (PCI) said it was disappointed by New York regulators’ decision to deny most auto insurers’ rate increases based on the assumption that higher gas prices would mean lowered risks to insurers.
Earlier this week, officials in New York said that decision meant drivers would end up paying $515 million less in premium than the amount originally sought by insurers.
PCI statistics show that while U.S. drivers are traveling fewer miles, and auto insurance claims in New York and across the country are decreasing in frequency, the cost of repairing vehicles continues to rise. Average claim costs in New York have increased by nearly 33 percent since 2000, according to PCI. The increase in the average cost per claim is substantially greater than the decrease in claim frequency, the group said, which puts upward pressure on insurance rates.
PCI’s membership comprises more than 1,000 companies, representing over $195 billion in annual premium, and nearly 52 percent of the U.S. automobile insurance market.