FSRA has released new auto insurance cost Benchmarks after the conclusion of a new evidence-based and transparent process. This process involved a study of industry loss data to June 30, 2019 by a leading independent actuarial firm, followed by a public consultation.
Benchmarks are updated twice a year to identify industry cost trends and are used by FSRA to help determine whether proposed rates are just and reasonable. The new Benchmarks show a decline in the expected future loss costs for Bodily Injury and Accident Benefits offset by continued growth in the expected future cost of vehicle repairs.
The new Benchmarks indicate auto insurance rate increases should moderate as the average future loss cost increase is 2.4% compared to 5.2% under the previous Benchmarks. This does not reflect the impact of reduced loss costs due to the COVID-19 emergency.
Auto insurance rates are based on both an insurer’s overall costs and a customer’s personal circumstances. Customers experiencing above-average rate increases may wish to seek an explanation from their insurance provider.
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