NORFOLK, Va. — The cost of insurance has been a hot topic of conversation in our community in the past year.
People are either getting dropped from their insurance providers or their premiums are increasing.
When I first reported this in April, it was the most-read story on our website for a week. Now, I am following through after I heard from so many News 3 viewers with their own stories.
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I met Allyson Rodriguez at her home in Newport News.
As we sat at her kitchen table, she asked the question that so many people have: “Why? Why is everyone's insurance going up so much?"
Rodriguez rents the home in Newport News with her family and says their insurance has gone up about $40 each month.
“I freaked out because I was like, how am I going to afford this big... I mean, it seems small, but once you start doing all of your bills, then it's really not that small,” she says.
In fact, that's an increase of around $480 a year—significantly more than she budgeted for.
To help answer Rodriguez’s question, I called up Michael DeLong with the Consumer Federation of America. His job is advocating for people to make insurance more affordable.
“I think premiums, auto insurance, and homeowners’ insurance are far too expensive,” says DeLong, a research and advocacy associate.
DeLong says vehicle rates are up close to 30 percent and homeowners’ policies, in some cases, are hovering around 50 percent.
“Insurance companies claimed that the parts, cost of parts and labor and repairs has gone up, which it has. So that's a factor,” says DeLong. “When inflation jumped up, and also when people got back on the roads [after COVID], the companies were taken by surprise and so they needed to raise rates to keep up with costs.”
As for homeowner’s policies, DeLong says one of the main drivers for those rising costs is climate change.
“There are more storms [and] there are more unusual weather events,” he says causing damage and forcing companies to pay out.
When I asked our viewers if their bills went up, I received dozens of responses. And nearly everyone who responded said yes.
One woman noted that her car insurance is up $1,200 a year with no accidents or claims filed.
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Generally speaking, DeLong says your credit score could be to blame.
“We found that in 2020, if you were a perfect driver with a perfect driving record and excellent credit in Virginia, you paid on average $378 for auto insurance, which is pretty good. But if you were the exact same driver, same driving record with no tickets, no crashes, no claims, but you had poor credit, you wound up paying on average $719 or 90% more,” DeLong says.
Rodriguez says she raised her deductible, but that also comes with risk.
“[The insurance company] kept saying, ‘Oh, you can raise your deductible.’ But if I raised my deductible, God forbid, I get into an accident or whatever, then I can't afford to fix my car because my deductible is so high,” she says.
She's now calling around to shop rates.
“Generally, we don't think having really high deductibles is a good thing, because one of the points of insurance is that it's supposed to protect people,” DeLong says.
Rodriguez tells me she feels stuck because she can’t live without insurance.
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“Families cannot afford for everything to keep rising,” she says.
DeLong also left me with some advice about getting a lower rate: He says for car insurance, try to improve your credit score, tell your insurance company if you don't drive that often (or long distances), take a driver improvement course, and ask if there are any discounts if you pay in full, as opposed to monthly.
Working with a local agent who can shop around for you may also present better results than using an online tool.
