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Vol. 42 / Issue 3 / March 2024 REGIONAL NEWS
Farmers Leads Insurers’ Rate Hikes Idaho Bill Impacting Aftermarket Auto with 17.6% Increase Farmers Insurance Group of Cos. raised its private auto insurance rates by a weighted average of 17.6% across 43 states in 2023, outpacing the rate hikes of its competitors but part of the broader trend in the industry, where double-digit increases have become the new norm.
states like New Jersey, Vermont and Colorado experiencing increases below 10%. This pattern of substantial rate hikes was not unique to Farmers Insurance. State Farm Mutual Automobile Insurance Co., another industry giant, reported a 16.0%
Parts Stalls
A proposed bill in Idaho has been held in a state Senate committee following concerted efforts by the Auto Care Association and its members. SB 1233 would amend a section of Idaho state code to add headlamps, fenders, hoods, tail lamps and bumper components to the definition of aftermarket crash parts; add language to written disclosure statements telling consumers that non-OEM crash parts may affect safety and performance of a vehicle, and recommend consumers consult with a qualified industry expert or repair shop before making any decisions regarding the use of nonOEM crash parts. The Auto Care Association
testified before the Idaho State Senate Commerce and Human Resources Committee, contesting SB 1233. Tod Moore, representing the association, spoke about the bill’s potential adverse effects on Idaho’s aftermarket sector, which is a significant contributor to the state’s economy. “In Idaho specifically, our industry provides over 12,492 jobs, generates $1.6 billion in economic activity, and provides $679 million in wages,” Moore said. “SB 1233 would have immediate, detrimental effects on this otherwise vibrant aftermarket ecosystem, not to mention the negative effect it will have on consumers.” l CONTINUED ON PAGE 17
REGIONAL NEWS
According to S&P Global Market Intelligence’s RateWatch, not only did Farmers Insurance lead this surge, but all 10 of the top auto insurers in the U.S. also imposed double-digit increases throughout the year, a shift from the more moderate rate changes observed between 2018 and 2021. For Farmers Insurance, the 2023 rise was approximately 3 percentage points higher than its 14.5% rate change in 2022. Nebraska witnessed the company’s highest increase at a weighted average of 30.4%. In contrast, North Carolina had the smallest rate hike at 1.8%, with other
weighted average rate increase in 2023. Similarly, Berkshire Hathaway Inc.’s GEICO Corp., despite having the lowest effective rate change among the top insurers at 10.1% in 2023, had experienced the previous year’s highest at 17.2%. The industry-wide trend of escalating rates was further evidenced by the nationwide effective rate change. In 2023, 43 states and Washington, D.C., reported an effective rate change greater than 10%, leading to a national average increase of 14.0%—a significant jump
CA Insurance Official Speaks At SCRS Open Board Meeting By John Yoswick Autobody News
The California Department of Insurance receives about 50,000 written complaints a year, about 42% of which involve auto insurance. Of those, about 10% come from shops. “Yes, we do handle body shop complaints,” Tony Cignarale, the agency’s deputy commissioner of consumer services, told attendees at a Society of Collision Repair
l CONTINUED ON PAGE 10
l CONTINUED ON PAGE 10
Tony Cignarale of the California Department of Insurance said insurers in that state must identify what estimate line items were adjusted, and provide support showing the changes were reasonable
INSIDE THIS ISSUE 4
Columnist Mike Anderson: How to Ensure You – and Your Techs – Have Adequate Business Insurance Coverage
18
Columnist Abby Andrews: Collision Repair Industry to Be Influenced by Supply Chain, Vehicle Complexity in 2024
6
Columnist Stacey Phillips Ronak: CES 2024 Unveils Future of
12
Columnist John Yoswick: Mitchell Joins CCC, Audatex in Giving
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