Prices of motor-vehicle insurance rose 20.3% in December from a year earlier, the biggest jump since 1976

Prices of motor-vehicle insurance rose 20.3% in December from a year earlier, the biggest jump since 1976, per Bloomberg.

U.S. car owners are unlikely to find relief from the escalating costs of maintaining a vehicle, as motor-vehicle insurance prices surged by 20.3% in December compared to the previous year. This marks the most significant increase since 1976, extending the trend of 16 consecutive months with annual gains surpassing 10%, as reported by the Bureau of Labor Statistics.

The persistently rising insurance rates are expected to continue their upward trajectory, driven by the increased expenses associated with replacement parts and repairs, according to analysts from Bloomberg Intelligence.

While prices for used cars and trucks have seen a decrease from their peak two years ago, the December consumer-price index revealed an unexpected uptick in used-vehicle costs from the previous month. This defied economists' predictions of a decline and contributed to an acceleration in the overall inflation rate.

Despite a decrease in 2023, used-vehicle prices remain elevated, registering a 38% increase since the onset of the pandemic. In contrast, new cars and trucks have not experienced as substantial price hikes as seen in 2022, with an annual increase of only 1% in December.