Distracted drivers are causing car insurance rates to rise. American drivers are on their phones texting, emailing, and using apps more than ever before, and they are getting into more accidents because of it.
As a result, insurers are forced to raise their rates because of rising costs and an increase in filed claims.
Preliminary estimates from the NHTSA show that traffic fatalities jumped 8% during the first nine months of 2016. There are a few reasons this may be the case. With a stronger economy and lower gas prices, more drivers are out on the roads. However, even when increased travel is taken into account, traffic deaths are still rising.
Smartphones and distracted driving have always been a safety issue, but it is possible that the increase in cars on the road, is giving drivers less time to react if they are distracted by their phones. Additionally, there are more apps available now and smartphone addiction is a growing societal concern.
Many surveys have found that the majority of drivers admit to using their phones behind the wheel. In this survey, 61% of drivers admitted to using their cell phones on some drives, most drives or every drive. Other studies have found the percentage to be even higher: 70% of drivers use their smartphones on the road.
While federal studies seem to be lacking the same high percentages, it is likely that distracted driving is higher than those studies report. One federal study simply observed passing cars in rural and urban areas. The studies that take police reports into account may also be biased, as drivers may not always admit that they were texting to the authorities.
Major insurer carriers are finding that they need to hike their rates. Currently, the costs related to car accidents are rising faster than their insurance premiums. Many big name providers had worsening fourth-quarter underwriting results and stated that distracted driving was a partial cause of that problem.
The average U.S. car insurance rate in 2016 was $926, up 16% from 2011. We can expect that average rate to surge again as insurers will likely have to raise rates this year if the trend continues.
Read more about car insurance rate increases here.
Source: The Wall Street Journal