Car insurance is exploding: prices are rising by up to 21 percent!

Car insurance is exploding: prices are rising by up to 21 percent!

Motor vehicle insurance in Germany is facing a new challenge: prices are rising significantly, which is causing problems for many drivers. According to current surveys reported, costs have increased by 16 percent compared to the previous year. Premiums for fully comprehensive insurance are particularly hard hit, with an increase of 17 percent. Since 2022, the increase has been a remarkable 50 percent, which fits into a trend of ongoing price increases.

Verivox's vehicle insurance index shows an even more drastic development. According to this, the average price increase in the last year is around 20 percent, especially when buying a new car. Liability policies have become 18 percent more expensive, while partially comprehensive insurance is 19 percent more expensive and fully comprehensive insurance is 21 percent more expensive. Even if you change your insurance without buying a car, the tariffs for partial and fully comprehensive insurance have risen sharply.

Causes of price increases

The price increases are not only due to increased demand. A key reason is the rising claims costs, which motor vehicle insurers can hardly cover anymore. According to the information the daily news German motor vehicle insurers recorded a deficit of over 3 billion euros in 2023, with a forecast of up to 2 billion euros in losses for 2024. The average cost of car property damage was around 3,700 euros in 2022, while it was around 2,700 euros in 2017. Experts warn that this trend could continue over the next 10 to 15 years, potentially doubling insurance fees.

Another factor that drives up costs is the complexity of modern vehicles. Increasingly integrated technology and electronics lead to higher repair costs and longer downtimes. The CEO of HUK-Coburg also criticized car manufacturers for above-average price increases for spare parts, which adds to the burden on consumers.

Market analysis and consumer tips

Market analyzes show that there are significant price differences between providers, which is why consumers are increasingly being advised to compare prices. The consumer advice center recommends comparing tariffs before making a decision in order to find the cheapest offers. Cheap fares can be up to 32 percent below the median market price, which could give consumers some options.

Given the current situation, vehicle owners must expect continued price increases. These developments are caused by both external pressures, such as rising workshop costs and repair prices, as well as internal challenges in the industry.