Market Competition Pushes Auto Insurance Costs Down

Massachusetts drivers have been able to take advantage of lower-than-average auto insurance premiums, even in the midst of the recession. The reason costs have remained low in such a tumultuous time is the competition. There are an exceedingly high number of insurers in the state vying for customers, which means they must lower their prices to remain competitive.

Along with higher competition, a loosening of regulations by the State of Massachusetts helped insurers set their new rates. Since 2008, insurance companies have been able to set their own premiums as long as they are approved by the Massachusetts Department of Insurance. This has been great news for drivers in the state. As a result of these new premiums, rates have dropped by 6.4 percent and have saved consumers up to $270 million in auto insurance premiums.

Another reason analysts say that Massachusetts drivers have been able to save on their premiums is because many of their insurers function primarily over the Internet. Research has shown that Internet comparison shopping tools make finding affordable coverage a lot easier for everyone around the country. So with their insurance companies functioning online, consumers can shop ’till they drop for affordable coverage from the comfort of their homes.

Unfortunately, not all states have been able to take advantage of competitive rates. Michigan, for instance, which currently has the highest rates in the country, has been fighting to lower rates for several months. However, experts reiterate that finding affordable coverage is possible in any state by being a safe driver, searching for discounts and comparison shopping online.

Are auto insurance rates affordable in your state?