Car insurance is becoming more expensive: experts warn of further increases in insurance premiums.

Car insurance is becoming more expensive: experts warn of further increases in insurance premiums.

According to a report by n-tv.de, car insurance is expected to become more expensive in the coming year. Hannover Re expects that German drivers will have to prepare for higher insurance premiums. This is primarily due to sharply above-average increases in spare parts and repair costs as well as increased claims frequencies, which lead to massive losses and a burden on the profitability of motor insurers. Michael Pickel, CEO of the Hannover Re Germany subsidiary E+S Rück, emphasizes that rising prices in motor vehicle insurance are inevitable in order to get out of the loss zone and make the business profitable again in the long term. However, this cannot be achieved within a year.

E+S Rück is one of the most important reinsurers for the motor vehicle sector. Negotiations are currently underway between insurers, brokers and reinsurers regarding the renewal of contracts as of January 1, 2024, particularly for the German market.

The impact of this development is likely to mean corresponding additional costs for car owners. Consumers therefore have to prepare for higher insurance premiums. This can cause financial stress, especially for households with multiple vehicles or young drivers who already have high insurance costs.

With regard to the car insurance market, this price increase could lead to customers increasingly looking for cheaper alternatives. This could lead to increased competition among insurance companies, which will have to adjust their rates in order to remain competitive.

The situation could also have an impact on the vehicle industry. Higher insurance premiums could deter potential car buyers or cause them to choose smaller vehicles with lower premiums. This could lead to a decline in sales of more expensive vehicle models.

Overall, the development points to a tense situation in the car insurance industry. The higher costs for insurance companies could require them to increase their rates to restore profitability. Consumers and the vehicle industry must therefore prepare for higher costs and possible adjustments.

Source: www.n-tv.de