Soaring auto insurance costs have been a principle driver behind inflation over the past year, but there could be relief on the way, according to Bank of America.
Rows of new Tesla cars are seen in a holding area near a customer collection point on April 15, 2024 in London, England.Soaring auto insurance costs have been a principle driver behind inflation over the past year, but there could be relief on the way, according to Bank of America. Primarily, the hit to insurers, which has been passed on to consumers, arose from three sources: higher vehicle prices, increased costs for repairs and "more accidents as driving trends returned to normal," Juneau said.Sales prices for new and used vehicles have been trending lower in recent months and are down 0.4% and 6.9% respectively on a 12-month basis, according tothrough April. Also, repair and maintenance services costs were flat in April through still up 7.6% from a year ago.
The recent trends probably do not "mean that your premium will fall, but we think the rate of increase should slow," Juneau said.