First, the number of fatal traffic incidents has spiked recently. According to information from the National Traffic and Safety Administration, fatal accidents increased nationally last year by 10 percent. That far outpaces inflation and population growth, and reflects the biggest year-over-year increase in traffic fatalities since the 1960s.
The likely culprit: Texting and driving. Distracted driving incidents are up by 9 percent 2015, says the NHTSA, and has resulted in the deaths of nearly 3,000 people in 2014 alone, according to reporting from the Chicago Tribune. State Farm estimates that as many as 36 percent of drivers text while driving. 29 percent admit to browsing the Internet while driving. More than 80 percent of teenage drivers report that they use their smartphones while driving.
Texting is not the only reason drivers are distracted on the road - an exponentially increasing number of cell phone apps and electronic technology installed in today's automobiles is constantly competing for drivers' attention. And as the economy recovers, more and more commuters are on the road, eating and doing their makeup on increasingly congested roads.
Lower returns on float
Insurance company revenues have been hit by low interest rates in recent years, which affects the rate of return that they can get on their reserve funds. Income from invested general funds, called "float" in the industry, has been low for years - forcing many carriers to increase premiums to cover their obligations.
How to keep your rate down?
- First and most importantly, drive safely. The more moving violations you have on your record, or at-fault incidents (depending on your state), the more you can expect to pay in premiums.
- You will also have to pay more if you have DUI conviction - and you'll have far fewer choices in selecting a carrier willing to cover you.
- Put the cell phone down when you're driving.
- Keep several coverages with one carrier. Insurance companies often offer discounts for 'bundling' multiple policies, such as car and homeowners' insurance.
- Employers should consider banning employees from using cell phones while driving.
- Have teenage drivers maintain good grades. Most carriers will discount premiums for young drivers who make the honor roll at school.
- Increase your deductible. The higher your deductible, the lower your premium, all else being equal.
- Take a defensive driving course.
- Minimize the mileage you drive.
- Install an anti-theft device.
- Purchase cars with safety features such as anti-lock brakes, daytime running lamps, and air bags. Most carriers discount premiums for safety features.
- Switch early. Many carriers will grant premium discounts to those who start shopping a few weeks before the old policy expires.
- Insure more than one car with the same company.