COLUMBUS, Ohio — Federal interest rate hikes are affecting every part of people’s budgets, including how they get around.
From 2022 to 2023, Ohioans’ minimum coverage for car insurance is up 54%. Full coverage is up 56%. That is higher than the national average.
“It’s happening I think for lots of reasons, one, like just general inflation,” said Abby Drexler, a digital public relations manager at MarketWatch Guides.
“The Federal Reserve has raised the rate 11 times since March of 2022. So, in order to keep up with that, companies are having to raise their rates," she said.
Those companies are raising those rates not only to catch up with inflation but to offset post-COVID supply chain issues.
“If you need to repair a part, it costs more to repair that part now,” Drexler said.
“Also, according to a JP power study, there was just a longer wait for car repairs in general. Car repair appointments are just taking longer.”
Drexler says climate change is another reason for higher car insurance rates.
She said Farmers Insurance is no longer going to provide its services in Florida, a state known for its hurricanes and storms.
Coverage costs also go up for fire-prone areas.
Drexler said the only way to address this and save money is to not sit still.
“I know it can be a pain, but actually try to shop around. they have the safe driving programs… if you’re a student if you’re a student, there’s like senior ones.”
She said they’re optimistic these kinds of price jumps won’t last forever, but as long as the federal interest rates keep hiking, costs will keep climbing.