Auto Insurance Claims: Annual Numbers And Insights

Auto insurance is a fact of life for millions of drivers in the US. In 2021, there were 4.2 auto collision insurance claims filed per 100 drivers, or roughly once every 17.9 years according to Fox Business. This means that by the age of 34, every person driving since they were 16 is likely to have filed at least one car insurance claim. While the number of claims filed annually is unclear, the high number of registered vehicles and vehicle crashes in the US means that auto insurance claims are a frequent occurrence.

Motorists file insurance claims roughly once every 17.9 years

The expenses associated with filing an insurance claim are not cheap. They can range from a couple of hundred to a few thousand dollars. With the proper foresight and planning, policyholders can ensure they have enough cash on hand to cover additional out-of-pocket expenses that arise when filing a claim.

The deductible is the amount of out-of-pocket money the motorist is responsible for paying before the insurance company covers the remainder. For example, if you have a $200 deductible and suffer $2,000 worth of damage to your vehicle, you need to pay $200 while the insurance company pays the remaining $1,800. Policyholders can lower their monthly premiums by raising their deductible. However, when the unexpected happens, those paying low premiums will end up having to pay much more. For instance, if you choose to raise your $200 deductible to $1,000, you'll save money monthly, but you'll need to pay $1,000 if you are in an accident or damage your car.

By calculating risks and comparing how much you can afford for monthly premiums and how much you have saved to pay a high deductible, you can determine a deductible rate that works best for you.

According to the Institute of Insurance Information, property damage liability claims cost the average motorist $3,290 annually, a $59 increase over 2013. The average claim for bodily injury was $16,640, an annual rise of $1,199, while the average claim for collision insurance was $3,160, a jump of $16 from 2014. In a rare change of pace, the average comprehensive claim was $1,567, a decline of $54.

With the exception of the anomalous decline in the average comprehensive claims, these rates have been trending upward for the past decade and will undoubtedly continue to increase slightly in the future. As claims become pricier, policyholders should be aware of the likely out-of-pocket expenses they'll get saddled with if the unexpected happens.

In 2021, there were 4.2 auto collision insurance claims filed per 100 drivers

The number of auto insurance claims being filed is influenced by several factors, including age, gender, driving record, location, credit history, and type of vehicle. For example, younger and less experienced drivers tend to have higher insurance costs because they are historically responsible for nearly 40% of crashes in the US. Additionally, male drivers tend to pay higher premiums than female drivers, as research shows that they engage in riskier behaviours behind the wheel and are involved in more accidents.

The cost of auto insurance is also impacted by the type of coverage selected. Liability insurance, which covers repairs to damaged property and medical bills for the other driver and their passengers, is considered the bare minimum and is mandated by most states. Collision coverage pays for repairs to the policyholder's car, regardless of who is at fault. Comprehensive coverage, which is often more expensive, protects against damage to the vehicle outside of accidents, such as theft and weather damage.

In the US, auto insurance rates have been steadily rising, with a spike of over 20% in 2023. This increase is attributed to various factors, including the rising cost of labour, inflationary increases in vehicle parts, extreme weather events, and an increase in crash fatalities. As a result, the average annual cost of full-coverage auto insurance in the US is expected to reach $2,160 in 2024.

The average claim for bodily injury was $16,640

The cost of a bodily injury claim is influenced by various factors, including the severity of the injuries, the impact on the victim's daily life and work, the cost and duration of treatment, and the emotional and psychological damage caused. These factors are taken into account by both the plaintiff and the defendant when negotiating a settlement.

In 2022, the average auto liability claim for bodily injury in the United States was $24,211, according to the Insurance Information Institute (III). This figure represents a significant increase from the previous year and contributes to the rising cost of auto insurance. The rise in auto insurance rates can also be attributed to factors such as the increased cost of labour, inflationary increases in vehicle parts, extreme weather events, and an increase in crash fatalities.

The frequency of bodily injury claims is relatively low compared to other types of auto insurance claims. In 2022, only 0.7% of people with liability insurance filed a bodily injury liability claim, while 2.4% filed a property damage liability claim. Collision and comprehensive insurance claims were also more common, with 4.9% and 3.3% of policyholders filing claims, respectively.

Bodily injury claims are typically the most expensive type of auto insurance claim, with an average cost of $16,260 per loss. This is followed by property damage claims ($3,729), collision claims ($3,278), and comprehensive claims ($1,690). The higher cost of bodily injury claims can be attributed to the severity of the injuries and the potential long-term impact on the victim's health, ability to work, and overall quality of life.

When it comes to negotiating a settlement for a bodily injury claim, it is crucial to have an experienced attorney. They can help assess the value of the claim, calculate lost wages, and determine the likelihood of winning a civil lawsuit. Additionally, an attorney can advocate for the plaintiff's rights and negotiate a favourable settlement with the insurance company.

The average claim for collision insurance was $3,160

The average collision insurance claim was $3,160 in 2014, a $16 increase from the previous year. This figure represents the cost of repairing or replacing a vehicle after an accident, minus any deductible that the policyholder might have to pay. Collision insurance is typically optional unless you have a car loan or lease, in which case your lender or leasing company will likely require you to have it.

The cost of collision insurance can vary depending on factors such as the age and value of your car, your driving record, and your chosen deductible amount. On average, the annual cost of collision insurance in the US is $381. However, this can be higher or lower depending on your specific circumstances. For example, older cars typically have lower collision insurance costs since the coverage will only pay out up to the car's value, which tends to decrease over time.

When deciding whether to purchase collision insurance, it's important to consider the likelihood of needing to file a claim. On average, motorists file insurance claims roughly once every 17.9 years. This means that by the age of 34, a person who has been driving since they were 16 is likely to have filed at least one car insurance claim. By planning and calculating risks, policyholders can make informed decisions about their deductible and monthly premium amounts.

In addition to collision insurance, there are other types of auto insurance that provide coverage for different scenarios. These include liability insurance, comprehensive insurance, personal injury protection, and uninsured motorist coverage, among others. The cost of auto insurance can be significant, with the average American paying $1,771 per year or about $148 per month. However, it's important to remember that auto insurance helps protect drivers from unexpected costs associated with accidents and vehicle damage.

The average comprehensive claim was $1,567

Comprehensive insurance is an optional addition to your car insurance policy that covers damage caused by or related to theft, animals, vandalism, and weather. It is also known as "bad luck" or "other than collision" insurance. It is important to note that comprehensive insurance does not cover damage from a collision with another vehicle or a rollover. For that, you would need collision insurance.

The cost of your comprehensive insurance policy is based on the "actual cash value" (ACV) of your vehicle. This is the cost to replace your car, minus depreciation. So, cars that are worth more are more expensive to insure. However, the price of your policy can vary greatly depending on your deductible. A deductible is the amount your insurance provider subtracts from the value of your vehicle when you file a claim. For example, if you have a $1,000 deductible and your car is damaged in a flood, your insurance provider will send you the amount to repair your vehicle minus $1,000. Comprehensive insurance policies typically have a deductible between $100 and $1,000.

Comprehensive insurance is a great way to save money and protect your vehicle from unforeseen events. However, it's important to note that comprehensive insurance may not be worth it if your vehicle is older and has depreciated in value. This is because your insurance provider will never pay you more than your vehicle's value minus your deductible. So, if the cost of your deductible and premium together exceeds your car's value, comprehensive coverage may not provide any benefit.

Frequently asked questions