Geico auto insurance will be increasing its rates in Illinois next year. The company, which is owned by Berkshire Hathaway, will raise premiums by an average of 3.5 across the state.
The new Illinois auto insurance rates will become effective on February 6, 2017 for policy renewals.
This is not the only increase being issued by Geico auto insurance. In fact, the insurer has been making similar announcements across the country. Throughout 2016, the average policy through the auto insurance company has seen a premiums increase of 6.9 percent. This, according to the most recent quarterly report issued by Berkshire Hathaway to the Securities and Exchange Commission.
Berkshire justified the increases in auto insurance rates through the payments it made in 2015. Last year, Geico experience a raise in both the severity and frequency of claims made by policyholders. This led to higher payments made more often, prompting a need for higher premiums.
Geico auto insurance isn’t the only insurer to increase its rates within the state.
The largest auto insurance company in the country, State Farm, has also been raising its rates in Illinois. It released a statement that said it would not be able to speculate on the way rates will head in the future. However, it did raise premiums by an average of 5.9 percent across the state on October 31, 2016.
Amy Bryant, a spokesperson for State Farm said “Customers with renewals in early 2017 may see a rate change as a result.”
Allstate stated in an earnings report released in November that it had hiked its auto insurance rates by an average of 7.8 percent throughout 2016. Tom Wilson, the Allstate chief exec, said at the time that “Until we know what frequency and severity is in the future, we can’t really determine when we’ll be changing our pricing.” He also pointed out that “If frequency and severity keep going up, we’ll have to continue to raise our prices.”
Clearly Geico auto insurance is only the latest to join the trend of higher rates for drivers in Illinois.
