The increase in auto insurance rates in the U.S. is due to various factors.

The cost of car insurance in the U.S. has increased by 26% in 2024, with the average annual premium for full coverage auto insurance reaching $2,543.

According to a report by the American Property Casualty Insurance Association, rising prices are due to longer repair times and more expensive rental car costs.

Also, cars are becoming costlier to fix.

"Stephen Crewdson, senior director of insurance business intelligence at J.D. Power, stated that in the past 12 months, insurers have aggressively increased premiums, leading to an environment where consumers are unable to find insurers with lower premiums."

IBISWorld reports that approximately 215 million Americans have auto insurance and the market is worth about $353 billion.

What are the other factors contributing to the increase in auto insurance rates and how are rising premiums affecting consumers and large publicly traded companies such as Allstate and Progressive?