Auto insurance rate drops for the third time within nine months

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The Louisiana Department of Insurance announced that State Farm Mutual Automobile Insurance Company received it’s third decrease within the past nine months. Insurance Commissioner Jim Donleon announced his approval for the rate decrease. 

Distracted driving is one of the driving forces behind years of increased auto insurance rates nationwide. In Lousiana, more than one-million policyholders will begin to pay less this Summer. 

“It’s a very good sign. The market is stabilizing and perhaps even dropping in price,” said Jim Donelon. Donelon said State Farm holds a third of Louisiana’s Auto Insurance Market. This April, policyholders will see another reduction. 

This follows a 2.7% decrease for State Farm coverage on private passenger vehicles that took effect in July. Also, a 1.8% decrease that took effect last September. “I think it’s driven by the fact that State Farm has lost about ten percent of their auto insurance market,” said Donelon. 

The aftermath of increased rates from distracted driving has caused many policyholders to seek other options.”They had 1.1 million policyholders two years ago and now just one million down from about ten percent,” Donelon added. 

He believes this evidences that competition in the auto insurance marketplace is truly the best protection for policyholders. “It will certainly put pressure on the other two-thirds of the market that want to come down to match the rate reduction,” he said. 

The Louisiana Department of Insurance advice drivers who are looking for cheaper auto-insurance rates to take this opportunity to compare and shop around.

For more information about rate decreases and other state insurance issues, visit http://www.ldi.la.gov/

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