Several states across the country have just introduced new rules increasing minimum coverage requirements for car insurance in an attempt to better protect owners, but is likely to hit them in the pocket..
Drivers in California, North Carolina, Utah, and Virginia can expect car insurance rates to rise in the near future as a result of the higher mandatory minimum liability limits required as of January 1, according to experts.
Newsweek contacted Bankrate, Insurance.com, Triple-I, and Insurify for comment on Thursday morning.
Why It Matters
California, North Carolina, Utah, and Virginia have all increased their mandatory minimum liability limits with the idea of helping against the rising costs of car repairs and medical bills. At the moment, the minimum is not enough to cover most claims, Insurance.com wrote.
But this move, in time, will have the likely effect of putting an additional financial burden on car drivers.
Cars sit in traffic in downtown San Diego on November 22, 2024. Drivers in several U.S. states could face higher car insurance rates as a result of a new law increasing minimum coverage requirements. Cars sit in traffic in downtown San Diego on November 22, 2024. Drivers in several U.S. states could face higher car insurance rates as a result of a new law increasing minimum coverage requirements. Kevin Carter/Getty Images
What To Know
The cost of car insurance rose considerably last year. According to data from consumer financial services company Bankrate, car insurance rates surged by 26 percent throughout 2024, reaching an average of $2,543 for full coverage.
Considering that the national median household income is $74,580, based on the latest data from the U.S. Census Bureau, Americans spend 3.41 percent of their wages on car insurance, Bankrate reported.
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