Your auto insurance is going up again. ‘Las Vegas partygoers’ are partly to blame

More than 100,000 Nevadans will see an increase in their auto insurance later this year due to inflation and other rising costs but still not as high as some auto insurers had hoped.

According to the Nevada Division of Insurance, six auto insurers, including Allstate and Farmers, will raise auto rates for private vehicles by at least 10 percent in October.

Nevada already ranks No. 4 for the highest auto insurance rates in the country, according to Insurance Business America, as many households are grappling with the rising cost of living in the Las Vegas Valley post-pandemic. The average annual cost for full coverage car insurance is $3,549, with residents paying almost 5 percent of their yearly income on auto insurance, the organization said.

Why do rates keep going up? According to Insurance Business America: “Nevada’s relaxed alcohol laws and the high number of Las Vegas partygoers drive up auto insurance costs.”

Auto insurance rates have been increasing nationally, as well. The Consumer Price Index for auto insurance has risen 18.6 percent from July 2023 to 2024, according to the Bureau of Labor Statistics.

“As claims become more costly due to inflation, lawsuit abuse and increases in everything from repair-related labor rates to parts costs and building materials, insurance carriers around the country have been adjusting rates,” said Country Financial, one of the companies anticipating an increase.

All insurers must go through the Nevada Division of Insurance when requesting a rate change; the actual division-approved rate is typically lower than the rate hike requested. This is due to the division’s mission to “protect the rights of Nevada consumers” and ensure “financial solvency of insurers.” The approved rates cannot be “excessive or discriminatory,” according to the division.

Cost increases are influenced by rising car expenses, insurance fraud, litigation, poor driving habits and the increase in Las Vegas’ population, according to the division.

“Automotive insurance rate increases are a national trend and issue,” the division said in a statement. “Recent increases can also be attributed to losses incurred by property and casualty carriers operating in Nevada.”

Is your auto insurance increasing?

Allstate will increase auto insurance rates by 10.8 percent on Oct. 28, affecting the most Nevadans at 94,804 people. The insurer had requested a 10.8 percent rate increase.

The reason for the hike is due to “increased driving, accident severity, inflation and repair costs,” Allstate said in a statement. The company said customers can “save money” with its Drivewise product or bundling home and auto.

Farmers Group Property and Casualty Insurance will be increasing auto rates by 24 percent, affecting 8,033 Nevadans. The company had requested a 60 percent rate increase.

Amica Mutual will be raising rates by 17.9 percent on Oct. 1, which will affect 2,362 Nevadans. The company had requested a 34 percent increase.

“As we continue to deal with ongoing inflationary pressures and the elevated cost of auto repairs, this rate increase is necessary to restore pricing adequacy,” said Amica in a statement to the Review-Journal. “We don’t take these decisions lightly, and will always make them in the best interest of our policyholders and company.”

Country Financial customers with either Country Mutual, Preferred or Casualty insurance, will see a rate increase on Oct. 9.

“We encourage clients to meet with a Country Financial representative to discuss their individual situations and consider options to effectively manage risks with solutions that best fit their needs,” the company said.

Country Mutual Insurance customers will see the highest increase, at 31.8 percent, affecting 1,856 Nevadans. The company had requested a 46 percent jump. Country Preferred Insurance will increase rates by 29.5 percent, affecting 3,942 Nevadans. Country Casualty Insurance will increase rates by 25.4 percent, affecting 225 Nevadans.

Emerson Drewes can be reached via email at edrewes@reviewjournal.com. Follow @EmersonDrewes on X.