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Rumor has it that deflation might bring some respite to would-be car buyers. I know, I can hear the collective sigh of relief. After all, average new car prices are right around the $45,000 mark. That’s well over $10,000 more than the industry average a decade ago. However, even with likely deflation around the corner, insurance rates could continue to stick car owners with pricey coverage, especially for specific vehicle types. 

Deflation could help would-be car buyers with initial purchases, but insurance rates aren’t showing much indication of falling

Car insurance is one of those things no one wants to pay for. I mean, think about it. You drive with your head on a swivel, neither recklessly nor hesitantly. It’s been ages since you’ve had a crash of any kind. Yet still, like clockwork, you pay your insurance rates to maintain your comprehensive coverage. You know, just in case. 

Deflation could be lower prices for durable goods like cars, trucks, and SUVs. However, deflation is also typically indicative of a weakening economy, per Investopedia. As such, consumers may be less inclined to spend in the first place. Tragically, your insurance rates might not follow the trends of lowering prices for durable goods.

Tragically, many vehicle owners have experienced insurance rates rising as much as 20% since last summer. In addition to the vehicle price, your rates could rise with factors like location, age, gender, vehicle type, and, of course, driving history. Still, the average American car insurance policy is up to more than $2,500 annually. 

Furthermore, certain vehicle types suffered bloated car insurance rates due to providers’ concerns over theft. For instance, Rebecca Long, a mother of three and owner of a 2016 Hyundai Sonata told WCPO Cincinnati about her rapidly rising rates. Long says her six-month premium rose by $343.

Of course, her insurance provider’s concerns aren’t unfounded. Social media challenges revealed exploitable weaknesses in many Hyundai and Kia models. As such, thefts rose, and insurance rates with them. In some cases, insurance providers wouldn’t cover certain Hyundais and Kias at all.

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Staff Writer

Erik Sherman

Erik Sherman joined the MotorBiscuit team as an Autos Writer in 2022. An admitted petrolhead and an avid motorcyclist, Erik has owned everything from classic cars to motorcycles to modern driver’s cars. Erik also has extensive experience with military and emergency vehicles, ranging from ambulances and fire engines to MRAPs and M-ATVs. Erik is an eager car and motorcycle reviewer with experience covering everything from sports cars to pontoon boats and jet skis.

Erik holds a Bachelor’s Degree in International Relations (IRG) from the University of Texas at Austin and has studied Chinese, Energy, and European Politics at the University of Glasgow in Scotland. Erik’s background is unorthodox; he is a United States Marine Corps (USMC) combat veteran, water survival practitioner, and a former firefighter/EMT. Additionally, Erik is a regular volunteer and former instructor with the American Red Cross (ARC).