Insurance Group Estimates Rise in Ohio Auto Insurance Premiums

Experts say the average amount Ohioans spent on auto coverage likely increased 4.7 percent between 2010 and 2012.

Recent estimates from the Ohio Insurance Institute (OII) indicate average auto insurance expenditures rose by 1.2 percent from 2010-11 and 3.4 percent from 2011-12.

Ohio has been under the national average for auto insurance expenditures every year for the past decade, according to reports from the National Association of Insurance Commissioners (NAIC), and the gap between the state and national average has been widening since 2002.

In 2010, the latest year for which the NAIC has data, the average expenditure for an Ohio auto insurance policy was $619 while the U.S. average was $791. The expenditure average included auto coverage costs of all drivers in the state, though not all drivers purchase the optional comprehensive and collision portions of a policy. According to the Insurance Information Institute (III), NAIC data from 2010 showed that 76 percent of insured motorists that year bought comprehensive coverage, which deals with incidents ranging from vehicle vandalism to theft, while 71 percent bought collision coverage, which covers damages when a vehicle strikes other cars or objects.

That NAIC report ranked the Buckeye state as having some of the nation’s lowest auto insurance expenditures, with 2010 data showing that it had the ninth-lowest average.

But costs have been rising since 2009. The state saw year-after-year expenditure hikes between 2005 and 2007 before seeing drops between 2007 and 2009. The year after that, Ohio saw a $3 increase in average auto insurance expenditures, based on the NAIC report.

In 2010, the Institute’s estimated increase of 1.2 percent amounts to an average increase of $8, while its estimated 3.4 percent increase the following year amounts to an average increase of $21. The 2012 estimate was from last spring’s AAA report on U.S. vehicle costs, according to the OII.

Drivers in Ohio may or may not see their rates change, since each auto insurer calculates rates differently and charges each driver a different premium based on a number of factors, including driving history. According to 2011 figures from the Ohio Department of Insurance, the state’s top 10 auto coverage underwriters reported rate changes ranging from a 4.8 percent drop to a 6.2 percent increase.

The OII said that the state’s high level of competition in the auto insurance industry has kept average costs down, with only Illinois offering as many providers as the Buckeye State throughout the entire U.S.

Last Year’s Summer Storms Some of State’s Worst Disasters Ever

The OII also reported disaster-loss data that has affected the state’s insurance industry.

Between 2010 and 2012, the state had more winter storms, tornadoes and wind- and hail-related events causing insured losses in the $25 million range than it had in the preceding decade. With more than 12 weather events of that type occurring in that two-year period, the OII reported loss estimates of more than $1.1 billion during that time period.

Losses are also worsening. Between 2007 and 2011, there was $1.6 billion more in catastrophic losses than the five years before then, amounting to a 187 percent increase between the two time periods.

The OII highlighted several events that struck the state in past years, including Hurricane Ike, which brought about $1.25 billion in insured losses, making it one of the state’s most costliest recent natural disasters.

The wind, hail and wintertime weather from six major storms in 2011 caused insured losses between $568 and $658 million.

Last year, the state saw another natural disaster that ranked as one of its worst, when “derecho” storms in late June and other summer storms in early July caused between $433 and $440 million in insured losses in just six days.

According to the OII, 16 percent of the approximately 96,700 claims from those storms were auto-related; 8 percent of the total loss estimate of $433.5 million came from auto-related damages.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

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