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Insurance Companies Lower Their Rates Even Though Louisiana Residents Believe Otherwise

Posted in Car Accidents,Car Insurance Claims on December 13, 2019

Louisiana drivers are no strangers to the concept of high insurance rates. With mounting household expenses and other economic pressures, they understandably want to find answers, if they do not understand its source.

Many people in Louisiana blame lawyers for high insurance rates when, in fact, companies, such as State Farm, have progressively lowered their rates over time.

Current Rate Reductions Offered by State Farm

As of November 25, 2019, State Farm Insurance implemented a proposed rate decrease. Drivers can expect to see a marked reduction, which signifies the company’s fourth decrease over the last two years. The additional rate decrease is expected to be 2.6 percent, which brings their combined rate reductions down to 10.4 percent.

The economic impact is tremendous for the State of Louisiana since the estimated savings are slated to be around $36 million. These additional dollars not only impact an individual’s household income, but it gives the state a much-needed injection of economic stimulation.

State Farm officials state that their decision was based on its desire to comprehensively serve local communities by improving costs associated with carrying an insurance policy. The specific rate decreases will depend on your policy, coverage, and driving history.

Legislation Affecting Louisiana Insurance Rates

The move does not come without pressure from external influences. Journalists, attorneys, and lawmakers have long criticized the rates that insurers charge.

Back in May of 2019, the Omnibus Premium Reduction Act was struck down by the Senate A Judiciary Committee. It would have increased the statute of limitations to file a claim from one year to two and reduced the jury trial threshold from $50,0000 to $5,000.

The decision was made based on the strain that the Act would place on Louisiana courts. Louisiana has some of the highest personal injury car accident claims filed in the country, and legislators stated that it would add an additional 57 to 87 jury trial claims on an already overcrowded docket.

People, who supported the efforts, believe that the Act would have lower litigation costs for insurers by providing alternatives for legal redress to settle out of court. Therefore, the actions would result in lower premiums over the long-run.

Strategies You Can Use to Keep Car Insurance Rates Lower

While Louisiana may feel singled out at times, the reality is that the state is experiencing a rate reduction while the rest of the nation is experiencing increases. However, there are other ways that you and your family can reduce your insurance costs even further.

You can use the following strategies to help lower your insurance costs or prevent them from rising:

  1. Obtain a policy for multiple drivers: Having multiple drivers on the same policy is one way in which you can save money on your motor vehicle insurance. This result is accomplished by insurers, like State Farm, offering a bulk discount for households.
  2. Take a driving education course: Defensive driving courses are available throughout New Orleans and Louisiana. It is an excellent way to demonstrate to your insurer that you are serious about safe driving. The course instructor can provide a certificate of your training that you can then pass along to your insurance company.
  3. Compare insurance premiums: Shopping around may seem like a hassle, but if you are dissatisfied with your current service levels and premiums, you may want to consider finding another insurer.
  4. Drive a smaller vehicle: Larger vehicles are more expensive to insure. Plus, they require additional maintenance and fuel to keep them running safely. It is for these reasons, alongside their overall size, that insurance companies charge more for trucks, minivans, and SUVs.
  5. Take public transportation: No one likes to take public transit when they are used to driving around in a self-sufficient manner. However, if you commit to taking public transportation once a week, you might be able to reduce your average mileage by a few thousand points. In turn, this strategy helps you reduce your insurance rates based on the amount you drive.
  6. Change your deductibles: Increasing a low deductible to a higher one might be a good strategy for someone, who historically has a safe driving record. It is a decision that you must carefully evaluate based on the individual driver and his or her future likelihood of getting into a car accident.
  7. Improve your credit score: Your credit score might be causing your higher insurance rates. People with bad credit tend to cost insurance companies additional administrative work when trying to collect on past due premium payments and managing your account. Paying off past due debt can pay tremendous dividends to drivers.
  8. Use antitheft devices: Motor vehicle theft and break-ins are covered by insurers. However, your insurance rates may be significantly higher if your vehicle does not have passive anti-theft devices that mitigate the risk to your insurer. Therefore, installing car alarms, steering wheel locks, and keeping your vehicle in the garage are all tactics that you can deploy to make your insurer feel better about offering a lower rate.
  9. Have a conversation: Contact your insurance agent to discuss lowering your rate. He or she will help you find opportunities to save money while still providing the coverage you need. Sometimes, having a simple conversation with a reasonable person is all it takes to achieve your financial goals.

As you can see, there are several methodologies that you can use to lower your car insurance rates. While they may not be what you wanted, there is a reality to living within one’s ability to afford it. By its very nature, insurance is not cheap for anyone and is a constant source of struggle for those who are feeling its impact.

Final Thoughts and Considerations

Companies, like State Farm Insurance, recognize the financial strain that car insurance places on Louisiana families. Over 95 percent of car accident claims never make it to trial since insurance companies prefer to settle out of court.

Therefore, a New Orleans car accident attorney is not responsible for any insurance rate increases. Due process of the law is something that every American should be afforded and holding insurance companies to their policies is not something to overlook.