GEICO, Allstate seek rate hikes in New Jersey

New Jersey drivers are set to see higher premiums as more auto insurers ask state regulators for rate increases.

Two of the companies looking to raise their rates are GEICO and Allstate, both of which filed for double-digit increases.

GEICO has a pending request for a 26% rate increase, while Allstate has requested a 29% rate increase.

The pending increases come as a new state law requires higher minimum liability coverage on car insurance policies purchased or renewed after January 1 of this year.

Under the new law, signed by Governor Phil Murphy in 2022, the minimum liability coverage is now set at $25,000 from $15,000. Additionally, policies must include $50,000 in coverage for accidents involving multiple injuries or fatalities, up from the previous requirement of $30,000.

This law will also raise the minimum liability to three years. Beginning in 2026, the minimum coverage will increase to $35,000, with coverage for accidents involving multiple injuries or fatalities increased to $70,000.

“We can’t even estimate what that impact would be because that number would be unique in New Jersey to the entire country,” O’Brien told NJ Spotlight News. “We don’t have the experience that we can estimate what the financial impact will be on New Jersey drivers.”

Apart from the new law, industry experts say the rate increase is also due to inflation and increased insurance costs.

As Michael Barry, chief communications officer of the Insurance Information Institute (Triple-I) said, inflation makes it difficult for insurers to keep up with the frequency and severity of accidents, how all parts are replaced vehicle and auto body repair. increased costs.

The prevalence of car thefts is another factor, with the National Insurance Crime Bureau (NICB) revealing that more than one million cars will be stolen in 2022.

“If you have a theft, now all of a sudden we’re talking about a total loss,” Barry told NJ Spotlight News. “It’s a $25,000 to $30,000 auto insurer claim.”

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