Buffalo, NY (WBEN) If your car gets bumped by another, tariffs may not just affect how much repairs will cost, but your car insurance premium as well.
AAA's Dave Kirst says anytime pricing goes up on a part or a vehicle, you could see that being sent down the road to the insurance end of it, and it's something we've seen before. "We saw this a lot during the pandemic," says Kirst. "Afterwards, we saw the rate starting to go up a little bit later on, these were based off of increased shipping costs and manufacturing parts on the cost are on the parts which then got passed along to the insurance. We could be seeing the same thing here based off of tariffs." Kirst says it's unclear how much more we could end up paying.
Kirst says there is a bit of relief courtesy of New York insurance regulations, which require approval before rates can go up. "Everyone has protections from the New York State Department of Financial Services," explains Kirst. "Anytime the insurance companies want to raise their rates, they have to file those with New York State, and they have to show that they've had a reason to do this. So they have to be paying out more for claims because of the increase in parts, cost of parts, than they were planning on. They have to show this over a period of time really to the state, and the state then finally has to approve those so we're not going to see any immediate increases on insurance because of this."
What about those who have excellent driving records? Mary Coello of One Click Insurance says this is why companies try to offer discounts. "Unfortunately, insurance is a pool of money. The insurance companies collect everybody's money, and then we pay for claims," explains Coello. "What we do to protect the good consumer who drives safely and doesn't have insurance issues, we give them additional discounts because we want to keep them happy. We don't want them to leave. So for that good consumer, for the one that is driving safely and is not having accidents, they should not see the price increase significantly," adds Coello.
Both recommend continually shopping around to provide less cost for their insurance. "My company is an online insurance business where our consumers come online, they shop, they like our prices, and they combined it in less than 10 minutes. So that's what we provide," says Coello. "There are defensive driving courses that are going to save you money on your insurance. There are other discounts where you may be able to take advantage of so always shop around with your insurance to try to find the best possible rate," says Kirst. If you are looking for a newer car, he adds take a look at the insurance rates prior to getting that vehicle. "They may be able to find out kind of a part history, like how much parts would cost for your vehicle, and try to keep that in mind with this too," adds Kirst.
