Skyrocketing auto insurance premiums are fuelling inflationary pressures the USA. Costs have been rising their fastest ever rates. Premiums jumped 2.6 per cent March alone, which means costs are a whopping 22.2 cent higher than this time last year. The increases contributed to inflation rising 0.4 per cent last month. No other category spending has soared as much as auto insurance. Foxbusiness.com said the average cost car insurance the US has surpassed $2,300 per year, which amounts to $192 a month. The rising prices are impacting the lowest paid most. Insurance is becoming more of a financial burden for those struggling to make ends meet the cost of living crisis.
Automotive analyst Sean Tucker tried to explain what is behind the rising prices. He said: "I think the biggest factor is a combination new cars and [them being] more expensive, so if you [wreck] your car, the replacement cost is really high, and a fender bender is very expensive right now." He attributed the sophistication technology, gadgetry and safety equipment modern cars to more expensive repair and replacement costs. The cost replacing the battery an electric car can range $6,500 to well $20,000. A simple fender bender is likely to damage costly embedded sensors, cameras and sonar. One factor driving labour costs is a shortage car mechanics.
