Car insurance rate hikes straining budgets for Florida families already facing home insurance crisis

TAMPA, Fla. - Florida’s insurance crisis is now burning families on both ends. As home insurance rates continue to soar, car insurance rates are also shooting up. 

We can blame it on a number of things, including inflation, in the form of rising prices at car dealerships and repair shops.

"When the cost of all those things goes up, then there’s only one thing that happens to the cost of auto insurance," said Bob Passmore with the American Property Casualty Insurance Association. 

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"The cost of things goes up gradually anyways, but we’ve seen an explosive amount of inflation over the last year or so," Passmore said. 

Another factor causing rates to jump is that there are more people driving now than during the pandemic – and more drivers means more crashes.  While that is true everywhere, Florida outpaces the nation when it comes to car insurance rates.

According to research from the Washington Post and FINN America, rates have jumped 88% in Florida over the last decade.  And there are some specific reasons why the state leaps off the page — including recent hurricanes. 

Hurricanes Irma, Ian and Idalia flooded and gutted a lot of cars, which drove up losses.

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Another factor is climate change. Insurance companies figure this into their risk models, which show Florida is disproportionately susceptible to future storms.

Some repair firms — particularly some who replace windshields — are overbilling and driving up costs even more. And beyond that, consumer groups and some state lawmakers also tie our insurance crisis to the people we elect, and who they appoint who approve the rate hikes.  

"Most people don’t realize there is an office of regulation that plays a role in this, that is appointed by the governor, by the cabinet that approves any type of rate increases," said State Rep. Anna Eskamani, a Democrat who represents Orange County.

What can consumers do about it?

One option is to raise your deductible – although that comes with a risk of paying more if you have an accident. If you're a safe driver, you could consider a discount for putting a device on your car that lets your insurance company track how well you drive.  

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But "you’re looking at a privacy tradeoff," said Kaveh Waddle of Consumer Reports.  

"If you’re willing to give up some of these details about where you’re going and how you’re driving, how often you’re driving, then you might see some benefit, but if you don’t want the insurer riding shotgun with you, then you might say no to some of these programs," said Waddle.

Also, consider price shopping through an independent agent who writes policies for a lot of carriers, because different auto insurers assess risk in different ways. That can lead to different quotes for the same coverage.