NEW YORK (MainStreet)If you're cruisin' in California with the top down and your radio blasting, you've got one more reason to smile: you're paying less for car insurance than you did 25 years ago. To tell you how long ago that was, Milli Vanilli owned the music charts back then. Yeah, that long.
A new analysis of state auto insurance expenditures during the period of 1989-2010 by the Consumer Federation of America reports that most Americans are paying 43% more for car insurance -- a total of $791 annually -- while Californians have actually seen rates decline, if only fractionally (0.3%) for the same time period, without factoring in inflation. It was the only state to see lower insurance rates for the timeframe.
During the two-decade span, 37 states saw larger increases than the national average while eight states and the District of Columbia saw increases smaller than the national average but still over 25%. Only four states saw increases less than 20%, based on data collected from the National Association of Insurance Commissioners.
"No other state has put in place the kind of strong oversight that California voters created in 1988, and no other state has seen auto insurance prices decline," says Hunter. "In California, as a result, Proposition 103 drivers are paying less for car insurance today than they were 25 years ago." The proposition created a "prior approval" system of regulation for most lines of insurance in California, including auto, homeowners, commercial and medical malpractice insurance. Under such a system, insurance companies are required to present rate hikes or other changes to the Department of Insurance for approval.