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Colorado Insurance Blog

Car Thefts Are On The Rise In Colorado

According to data provided by the Colorado Metropolitan Auto Theft Task Force (CMATT), car thefts in Colorado have increased by 173% in the past 3 years. That makes Colorado the No. 1 state in the nation for car thefts per capita, as reported by the National Insurance Crime Bureau.

What is causing the number of car thefts to soar in Colorado?

One contributing factor is the growing homeless population in Denver. Many car thieves that are repeat offenders are part of the homeless population and use the stolen cars as shelters. Though most stolen cars are eventually recovered, the thief is often long gone and never found.

The relatively lax laws against car theft also play a significant part in the increasing rate of car theft. Even when thieves are caught, they tend to get out within days and see little to no punishment. The lack of real repercussions for car thieves makes it a low risk/high reward crime, leading to many repeat offenders.

Which vehicles are most at-risk of being stolen?

The Colorado Auto Theft Prevention Authority (CATPA) released a list of the 10 most-stolen vehicles in the Denver metro area from January-March 2022:

What can you do to prevent your car from being stolen?

  • No “Puffing.” Don’t leave your car running when you’re not in it.
  • Lock your car and roll up your windows. Leaving it unlocked, the windows down (even just a crack), or leaving a spare key in or on the car makes a thief’s job much easier.
  • Park in a garage if you can. Significantly fewer cars are stolen from garages than from driveway, streets, or parking lots.
  • Park in well-lit areas. Both in public and at home. If you park in your driveway or on the street at your house, consider adding a bright light to reduce shadows where a thief could hide.
  • Don’t leave valuables in your car. Many cars are targeted because the thief sees money, a computer, a camera, a purse, or some other valuables inside.
  • Install an outdoor camera that covers the area where you park your car. Just the presence of a camera can deter a would-be thief, and if your car is stolen it can help identify the culprit.

Read more tips for car theft prevention from Lockdown: https://lockdownyourcar.org/prevention/

Catalytic Converter Thefts are Soaring

What is a catalytic converter?

A catalytic converter is part of a vehicle’s exhaust system that helps turn toxic pollutants into cleaner emissions.

Why are they being targeted?

They are made of precious metals, commonly platinum, palladium and rhodium, all of which can be sold for high prices. A single catalytic converter can be sold for as high as $1,500.

Since they are easy to steal, many can be stolen in a short period of time. Since they are easy to steal and worth a pretty penny, they are a prime target for thieves to make money quickly.

Where are vehicles most at-risk?

Cars that are parked in public spaces are the most likely to have their catalytic converter stolen. Places where cars are likely to be parked for a longer period of time, like a Park-N-Ride or airport parking lot, are the most commonly targeted.

Which vehicles are targeted the most?

According to Denver7, Hondas and Toyotas are the most targeted vehicles in the Denver area.

What can you do to prevent your catalytic converter from being stolen?

The police don’t recommend confronting someone if you see them trying to steal your catalytic converter. There’s a pattern of thieves pulling weapons when confronted. It’s safer to call the police and report the theft in-progress while keeping a safe distance.

Some steps you can take to prevent theft:

  • Park in a garage or well lit area
  • Have the bolts holding the catalytic converter welded in place
  • Put a cage around it
  • Get your VIN engraved on the catalytic converter, which may deter theft or increase the chances of finding your missing part

Sources:

Contreras, Ó., & Miller, B. (2022, April 4). Catalytic converter thefts: What cars are being targeted, where it’s happening, & how to protect yourself. Denver 7 Colorado News (KMGH). Retrieved August 30, 2022, from https://www.thedenverchannel.com/news/360/catalytic-converter-thefts-what-cars-are-being-targeted-where-its-happening-how-to-protect-yourself


Auto theft prevention tips- CATPA – all about puffer cars. CATPA. (2022, July 6). Retrieved August 30, 2022, from https://lockdownyourcar.org/prevention/


Fields, M. (2022, July 18). Fields: Aurora offering a model solution to Colorado car theft tsunami. Sentinel Colorado. Retrieved August 30, 2022, from https://sentinelcolorado.com/opinion/fields-aurora-offering-a-model-solution-to-colorado-car-theft-tsunami/


Friday. (2022, July 1). Year-to-date Colorado car thefts outpacing 2021. Colorado State Patrol. Retrieved August 30, 2022, from https://csp.colorado.gov/press-release/year-to-date-colorado-car-thefts-outpacing-2021


Kovaleski, J. (2022, June 21). Here are the areas where your car is most likely to get stolen in the Denver Metro Area. Denver 7 Colorado News (KMGH). Retrieved August 30, 2022, from https://www.thedenverchannel.com/news/investigations/here-are-the-areas-where-your-car-is-most-likely-to-get-stolen-in-the-denver-metro-area


Nieto, G. (2022, April 14). Top 10 most-stolen vehicles in the Denver Metro. FOX31 Denver. Retrieved August 30, 2022, from https://kdvr.com/news/local/top-10-most-stolen-vehicles-denver-metro/


Pender, C. (2022, August 9). Why do people steal catalytic converters? KRON4. Retrieved August 30, 2022, from https://www.kron4.com/news/why-do-people-steal-catalytic-converters/#:~:text=The%20three%20precious%20metals%20that,%2C%20according%20to%20cars.com.

Do You Need to Insure an E-bike?

What is an E-bike?

According to Colorado Parks & Wildlife, an E-bike has 2 or 3 wheels, fully operable pedals, and an electric motor that doesn’t exceed 750 watts of power.

There are 3 classes of E-bikes:

Important Colorado E-bike laws:

  • Electronic bicycles are not required to be registered
  • There are no license requirements for E-bikes
  • Generally speaking, Class 1 and 2 E-bikes are allowed to operate on the same paths as conventional bikes, thought local jurisdictions can prohibit operation on specific paths
  • Class 3 E-bikes are only allowed on streets and bike lanes, unless specifically permitted by local jurisdictions
  • There are different rules pertaining to State Park or Wildlife Areas
  • E-bikes must ride in the right-hand lane when traveling a less than the normal speed of traffic on a roadway
  • Riders must signal intent to turn or stop and yield the right of way to pedestrians
  • One hand must be kept on the handlebars at all times
  • Class 3 E-bikes have the following age and helmet restrictions:
    • Operators must be 16 or older (passengers can be under 16)
    • Operators and passengers under 18 must wear a helmet

Does an E-bike have to be insured?

The short answer is no. There aren’t any legal requirements to insure an E-bike. That being said, if you have a loan on an E-bike, your lender will likely require you to carry insurance on it.

Even though you’re not required to have insurance on an E-bike, it’s important to at least have liability coverage. You can go faster on an E-bike than you might otherwise travel on a conventional bike, which makes the risk of crashing a little higher. If you hit a person, fence, house, mailbox, or something else, you could be responsible for the damages. Liability insurance will help you pay for those damages if a situation like that arises.

If you’ve paid a pretty penny for your E-bike, it probably makes sense to get adequate insurance for it. That way if it gets stolen, damaged in a fire, you’re in an accident, or something else happens, you’re not left empty handed.

How to insure an E-bike:

Many homeowners policies will afford some amount of coverage for an E-bike. Some policies may only extend liability, whereas others have a special limit of physical damage coverage included and some may not extend any coverage at all. Each insurance carrier has their own guidelines, so be sure to check what coverage you have on your policy.

Keep in mind that most home policies have a deductible of $1,000 or higher, so if you’re counting on your home policy to cover any damages to your bike you’ll need to cover your deductible before your policy pays out. Depending on the value of your E-bike and your home insurance deductible, it might not make sense to insure it on your home policy.

Many E-bikes cost several thousand dollars, so a total loss might exceed your deductible. But if a $1,200 E-bike was stolen, that’s not a claim I’d recommend filing on a home policy. You’d only get $200 from that claim example, which isn’t worth having a claim against your home insurance since it would likely cause your premium to increase for up to 5 years.

If you don’t have a home policy or if your policy doesn’t provide the coverage you’re looking for, you can generally insure and E-bike on a motorcycle policy. One benefit of that is that you can choose a lower deductible, like $500 or even lower.

Another plus is that you can file a claim without it impacting your home insurance. A claim for a stolen E-bike wouldn’t cause your motorcycle premium to increase like it would if you filed a claim on your home policy.

Insuring an E-bike on a motorcycle policy would also give you the option of Medical Payments and Uninsured Motorist coverage, both of which can be extremely valuable. Medical Payments coverage can help pay for your injuries, regardless of whether you’re at fault for a loss. The limit is usually $5,000 per person, but limits can vary.

Uninsured Motorist coverage will help cover your costs if you’re not at-fault for in an accident and the other person doesn’t have enough coverage. You can get Uninsured Motorist coverage up to the bodily injury liability limits on your motorcycle policy.

Read more about Uninsured Motorist coverage: What is Uninsured Motorist Coverage?

Sources:

Colorado Parks & Wildlife. Colorado Parks and Wildlife. (n.d.). Retrieved June 27, 2022, from https://cpw.state.co.us/thingstodo/Pages/E-Bike-Rules.aspx


Electric Bicycles. Electric Bicycles | Colorado General Assembly. (n.d.). Retrieved June 27, 2022, from https://leg.colorado.gov/content/electric-bicycles

Top 4 Reasons Insurance Rates in Colorado are Increasing

1. Volatile Catastrophe Trends

In the insurance industry, a “catastrophe” is a disaster that is unusually severe and meets or exceeds a loss threshold. As of December, 2021, the current dollar threshold to declare an event a catastrophe is $25 Million, according to Insurance Information Institute. Some examples of catastrophic events include tornadoes, hailstorms, high wind, flooding, hurricanes and wildfires.

Colorado does see some flooding and tornadoes, but the largest losses come from wildfires and hailstorms. Colorado has the 3rd highest wildfire risk in the US and had the 2nd most hail claims filed between 2018-2020.

Wildfire

Insurance Information Institute reported that as of October, 2021, Colorado has 373,900 properties with “high to extreme wildfire risk.” That makes up 17% of the properties in the state. With so many properties at risk of being damaged or destroyed by wildfire, insurance companies have to plan accordingly.

Colorado’s highest catastrophic payouts since 2017:

May 8, 2017 Denver Metro Hailstorm: $2.3 Billion

2018 Front Range & CO Springs Top 3 Hailstorms:  $276.4 Million, $169 Million, $172.8 Million

2020 East Troublesome Fire: $543 Million

2021 Marshall Fire: Over 1000 structures destroyed and estimated $1 Billion in damages

Catastrophe Facts and Statistics- RMIIA

The high wildfire risk in Colorado means higher rates across the state. But insurance companies charge more for insurance on homes that have the highest risk. They do this by assigning each property a Protection Class (PC) or Brushfire Score, which determines the risk of fire and the responding fire department’s ease of access and resources. The higher the PC or Brushfire Score, the higher the premium charged to insure that property.

Read more: What You Should Know About Wildfires and Insurance

Colorado has the 3rd highest wildfire risk in the US and had the 2nd most hail claims filed between 2018-2020.

Hail

Hail has been a problem in Colorado for as long as I can remember, but the number and severity of claims have increased significantly over the past decade. Part of that is due to the increasing population in the state. The more homes that are built on the Front Range, the more targets there are for hail to hit.

Between January 1, 2017 and December 31, 2019, Denver and Colorado Springs were in the top 5 cities for hail losses, with Denver at #2 and Colorado Springs at #3, according to an Insurance Journal article. Insurance companies in Colorado pay out hundreds of millions, if not over a billion dollars for hail damage every single year. Most companies have higher deductibles for wind and hail losses to help mitigate the risk. They also have to charge an adequate amount for both auto and home insurance.

2. Traffic Accidents

There are three major factors causing the number and severity of traffic accidents to rise in Colorado: Booming Population, Impaired Driving, and Distracted Driving.

Population Growth

It’s no secret that the population in Colorado is increasing at a rapid rate. According to U.S. News, the 2020 Census showed that Colorado was 6th fastest-growing state from 2010-2020, with a 14.8% growth. Unfortunately, traffic infrastructure has not kept pace with the population growth, leaving many roads on the front range gridlocked more frequently than not. More cars on the road directly correlates with accident frequency.

Distracted Driving

In addition to the heavier traffic, dangerous driving activities are becoming more common. Nearly everyone has a smart phone, and most people don’t put their phone on “Do Not Disturb” when they get behind the wheel. Distracted driving can include anything that takes focus away from the road, including texting, talking on the phone, eating, reading, and more.

According to CDOT’s 2021 annual survey:

91% of participants reported driving distracted in the past seven days.
54% admitted to reading a message on their phones.
Nearly 50% talked on a cell phone while driving.
41% sent a message while driving.

CDOT also reported that in 2020, 10,166 crashes in Colorado involved distracted drivers. Those accidents caused 1,476 injuries and 68 deaths.

Impaired Driving

Impaired driving is also contributing to more severe and frequent accidents. The total number of fatal crashes has increased by 37% from 2011 to 2021. Fatalities involving drivers that tested positive for drugs increased by 39.3% from 2015 to 2019. Drivers with a BAC over the legal limit were involved in 8.6% more fatal accidents during that same time.

From 2020 to 2021, the number of DUIs involving marijuana went up by 48%. While not all DUI incidents end in an accident, the increase in risky driving behavior certainly impacts the frequency of crashes.

With impaired and distracted driving causing more crashes, injuries and fatalities, insurance companies are paying out more for auto claims in Colorado. Higher medical costs are also impacting the higher payouts for auto accidents. Berkley Accident and Health reported that treatment costs increased by 6% in 2020 and another 7% in 2021.

Unfortunately when accident frequency and severity increases, we all pay the price. The more insurance companies pay out in claims, the more rate increases they are forced to take in order to remain solvent in the state.

3. Supply Shortages

There have been worldwide supply shortages since the pandemic started in 2020, which have led to inflated prices across most industries. Since the materials for home construction and auto parts are more expensive, insurance payouts are also inflated.

Auto Part Shortages

According to the Consumer Price Index, the cost of auto parts have increased by 14.2% from March 2021-March 2022. Insurance companies generally consider a vehicle a total loss if it will cost more than 70% of the vehicles value to repair the damage. That means more cars are being totaled because of the inflated repair costs.

Both new and used cars are also much more expensive than they were a few years ago. Supply chain disruptions have made it harder for manufacturers to produce enough new vehicles. There were 7.7 Million fewer vehicles produced in 2021, largely due to the microchip shortages. The shortfall of new vehicles directly impacts the price of used vehicles.

Price increases from March 2021 – March 2022:

New Vehicles: 12.5%

Used Vehicles: 35.3%

Motor Vehicle parts and equipment: 14.2%

*According to the U.S. Bureau of Labor Statistics Consumer Price Index

As the values of used vehicles increase, the payouts for total losses get higher. With insurance companies paying out more, the cost of insurance also goes up.

Building Material Shortages

On top of the rising costs impacting auto insurance, the costs of building materials have also soared because of supply chain shortages. Lumber prices jumped 42% in the first year of the pandemic, and steel mill products rose 81% in the first three quarters of 2021. Throughout 2021, the price of materials for new construction increased by over 18%.

The inflated cost of materials alone has led to much higher prices for rebuilding homes that have been damaged. Just like with auto insurance, higher home claim payouts leads to home premium increases.

On home policies, insurance companies are increasing rates to keep up with the amount they are paying out for claims but premiums are also rising due to higher coverage amounts. Since it costs more to rebuild a home, the amount of coverage you have on your home policy is likely also increasing.

There’s a good chance that if your policy was written more than a year ago, you don’t have enough coverage to rebuild your whole home.

You may have been able to rebuild your home for $150/square foot 4 or 5 years ago, but now it might cost closer to $275/square foot. As a result, your dwelling coverage (Coverage A) needs to increase to ensure your home is properly insured.

Many homeowners found out they were underinsured after the Marshall Fire, which is largely due to the rapid inflation seen in the past several years. If you haven’t review your home coverage with a licensed agent recently, I highly recommend you do. There’s a good chance that if your policy was written more than a year ago, you don’t have enough coverage to rebuild your whole home.

Read more: If Your Home Burned Down, Would You Have Enough Coverage?

4. Labor Shortages

You can walk into almost any business and see a “Help Wanted” sign on the door. It’s no secret that there are labor shortages across most industries. The shortage of workers has directly impacted the supply shortages, but even when the supplies are available many industries don’t have enough people to actually do the work.

Auto Technician Shortages

There’s currently a deficit of trained auto technicians to work on repairing damaged vehicles. To keep up with demand, there needs to be 3 times as many qualified technicians. The shortfall of auto technicians is causing higher auto repair costs and longer repair times.

When it takes longer to repair a vehicle, the insurance companies end up paying for a rental car for longer which also increases the claim payout amount.

Skilled Construction Labor Shortages

When it comes to home construction, there’s a shortfall of at least 200,000 skilled trade workers. That has led to more expensive bids for both home repairs and new construction. Not only are skilled workers charging more for their labor, but the amount insurance companies are paying for Additional Living Expenses is much higher.

Most home policies come with coverage for Additional Living Expenses, so if you can’t live in your home due to a covered loss they will pay for the additional expenses you incur as a result. That includes a hotel or long-term rental, restaurant expenses if you don’t have a kitchen to cook in, dry cleaning bills if you don’t have access to a washer and dryer, and more. If takes 6 months longer to rebuilt your home after a loss, the insurance company is paying those expenses for longer.

At the end of the day, the amount insurance companies pay out for claims directly impacts the amount they charge for insurance. All of the reasons listed above are causing insurance companies to pay out more than they have in the past. As a result, the cost of auto and home insurance are increasing accordingly.

Sources:

Boyd, S. (2021, January 29). Marijuana Dui Arrests Up 48% In Last Year Across Colorado. CBS Denver. Retrieved April 13, 2022, from https://denver.cbslocal.com/2021/01/29/marijuana-dui-colorado-arrests-alcohol/

Catastrophe Facts & Statistics. RMIIA. (n.d.). Retrieved April 13, 2022, from http://www.rmiia.org/catastrophes_and_statistics/catastrophes.asp#:~:text=The%20most%20destructive%20wildfire%20in,and%20auto%20insurance%20claims%20filed

Davis Jr., E. (2021, April 28). 2020 census shows America’s fastest-growing states | best … U.S. News & World Report. Retrieved April 13, 2022, from https://www.usnews.com/news/best-states/slideshows/these-are-the-10-fastest-growing-states-in-america

Distracted driving. Colorado Department of Transportation. (2022, April 4). Retrieved April 13, 2022, from https://www.codot.gov/safety/distracteddriving

Facts + Statistics: Wildfires. Insurance Information Institute. (n.d.). Retrieved April 13, 2022, from https://www.iii.org/fact-statistic/facts-statistics-wildfires

Spotlight on: Catastrophes – Insurance Issues. Insurance Information Institute. (2021, December 13). Retrieved April 13, 2022, from https://www.iii.org/article/spotlight-on-catastrophes-insurance-issues

Top states, cities for insurance claims for hail damage. Insurance Journal. (2020, April 28). Retrieved April 13, 2022, from https://www.insurancejournal.com/news/national/2020/04/28/566579.htm

U.S. Bureau of Labor Statistics. (2022, April 12). Table 7. consumer price index for all urban consumers (CPI-U): U.S. city average, by expenditure category, 12-month analysis table – 2022 M03 results. U.S. Bureau of Labor Statistics. Retrieved April 13, 2022, from https://www.bls.gov/news.release/cpi.t07.htm

Unni, C. (2021, November 29). The Pandemic’s Lasting Effects: Medical Costs Projected to Rise 6.5% in 2022. Berkley Accident and Health. Retrieved April 13, 2022, from https://www.berkleyah.com/the-pandemics-lasting-effects-medical-costs-projected-to-rise-6-5-in-2022/

Larger Rate Increases Expected in 2022: Here’s Why

Across the insurance industry, rates are expected to increase even more this year than they have in recent years. While annual increases are becoming the norm, the jump may be more drastic in 2022.

There are many factors that are driving insurance costs up. Claim payouts are higher than ever, and natural disasters and car accidents are becoming more frequent. Combine that with supply chain issues and labor shortages, and you have the unprecedented market we’re currently in.

Homeowners

Building material costs are at an all-time high

With global supply chain issues and labor shortages, prices for many products have soared over the past few years. Building materials are no exception.

During the first year of the pandemic, the cost of lumber jumped up by 42%. The prices have fluctuated since, but aren’t back to the pre-pandemic prices. In the first three quarters of 2021, steel mill products rose in cost by 81%.

There’s also currently a shortage of at least 200,000 skilled trade workers. 60% of surveyed builders are reporting labor shortages and the vast majority of them don’t expect that problem to go away in the next 6 months.

Price increases from December 2020 – December 2021:

Floor Coverings 3.9%
Window Coverings 8%
Major Appliances 6%
Overall Construction Supplies 18.4%

All of these factors have led to more expensive construction projects for both home repairs and new construction.

Home claims are rising in both severity and frequency

Catastrophic home claims are no longer few and far between, they seem to be happening every other week somewhere in the country.

In 2021, there were 20 natural disasters with losses exceeding $1Billion in the US alone. From 1980-2021 the annual average is 7.4 events, but the annual average in the past 5 years is 17.2 events.

Many scientists and experts attribute the increased frequency of disastrous events to climate change. As our weather and climate changes, severe weather events are becoming more common and severe.

Between the increased frequency and severity of home claims and the higher cost of building materials, home insurance prices will continue to increase. The chances that you’ll need to file a claim on your home are higher, and it will cost even more to repair or rebuild your home than it has previously.

Auto

Supply chain disruptions are causing costly shortages

Supply chain issues are impacting many different industries, including auto production. 7.7 Million fewer vehicles were produced in 2021 due to supply chain complications.

One of the most impactful shortages has been microchips that are used in vehicles. With most vehicles containing higher levels of technology than ever before, it’s been difficult for manufacturers to keep up with demand.

Because of the microchip shortage, there’s a shortfall of new vehicles on the market, which has driven up the cost of used vehicles.

Price increases from December 2020 – December 2021:

New Vehicles 11.8%
Used Vehicles 37.3%

Many rental car companies sold a large portion of their vehicles in order to survive during the pandemic. Once travel increased again over the summer of 2021, they had to restock their fleet of vehicles. With fewer new vehicles on the market due, they turned to used vehicles.

Around the same time, consumers who had extra money from stimulus checks also began shopping for new and used cars. The combination of that and the rental car companies drove the prices of used vehicles up significantly in June. Those prices remained inflated through the end of 2021 and aren’t expected to drop anytime soon.

The cost to repair vehicles keeps rising

In addition to the microchips, there are also supply chain issues impacting wiring harnesses, plastics, and glass used by auto manufacturers. As a result, the cost to repair vehicles is up around 20% and the cost of auto parts is up 6%.

Similar to the skilled labor shortage seen in the construction industry, there’s also a need for 3 times as many trained auto technicians. The delays in obtaining auto parts and the lack of skilled technicians to complete the repairs have made auto repairs take significantly longer.

With cars being stuck in the shop for longer than usual, that takes up even more of the rental car market. People are needing rental cars for longer, and they are harder to find. That drives the cost of rental cars up and exhausts the car insurance coverage limits faster.

Driving has returned to pre-pandemic levels

At the beginning of the pandemic there were fewer drivers on the roads and there were fewer accidents as a result. During that time, many insurance companies decreased premiums and offered credits or refunds.

In 2021, however, we saw a return to pre-pandemic driving levels and a rise in the number and severity of accidents. Insurance companies found themselves with underpriced policies, which is causing them to now increase rates to keep up with the high claim payouts.

If you’d like to discuss your insurance options or get a proposal, give us a call today. We’re here to help!

Sources:

Semiconductor shortages to cost the auto industry billions. AlixPartners. (2021, September 23). Retrieved January 27, 2022, from https://www.alixpartners.com/media-center/press-releases/press-release-shortages-related-to-semiconductors-to-cost-the-auto-industry-210-billion-in-revenues-this-year-says-new-alixpartners-forecast/

Smith, A. B. (2022, January 24). 2021 U.S. billion-dollar weather and climate disasters in historical context. 2021 U.S. billion-dollar weather and climate disasters in historical context | NOAA Climate.gov. Retrieved January 27, 2022, from https://www.climate.gov/news-features/blogs/beyond-data/2021-us-billion-dollar-weather-and-climate-disasters-historical

U.S. Bureau of Labor Statistics. (2022, January 12). Table 2. consumer price index for all urban consumers (CPI-U): U. S. city average, by detailed expenditure Category – 2021 M12 results. U.S. Bureau of Labor Statistics. Retrieved January 27, 2022, from https://www.bls.gov/news.release/cpi.t02.htm

NOAA National Centers for Environmental Information (NCEI) U.S. Billion-Dollar Weather and Climate Disasters (2022). https://www.ncdc.noaa.gov/billions/, DOI: 10.25921/stkw-7w73

Most and Least Expensive Cars to Insure

When determining the cost to insure specific vehicles, insurance companies look at multiple factors. First, they review the claim payouts for similar vehicles. Not only what it costs to repair damage to that vehicle, but also the liability payouts associated with it. If that model of car has caused significant liability payouts, it’s more likely to cause damage or injuries in an accident.

Cars with advanced technology and safety features are a bit of a Catch-22. They make a car safer and less likely to get in an accident, but they cost more to repair. So in the end it could be a wash when it comes to the cost of insurance.

Each person driving the same model of car won’t be paying the same amount to insure it. That’s because there are more factors that go into the cost than just the car itself. In addition to the features of the car, each driver on the policy plays into the cost to insure a vehicle. Your driving record, garaging location, credit and claim history impact how much you’ll pay to insure your vehicle.

According to Forbes, these are some of the most and least expensive vehicles to insure among popular 2021 vehicle models.

What types of cars are the most expensive to insure?

Sports cars- Sports cars tend to be more expensive to insure. They are built for speed, which can often lead to risky driving behaviors and accidents.

Luxury Vehicles- The parts needed to repair luxury cars can be hard to find and have a higher price tag. As a result, these cars are on the more expensive side when it comes to insurance.

Electric Vehicles- Some of the components that make up an electric vehicle cost a lot to replace. For example, a battery alone can cost thousands of dollars. As a result, the repair costs after an accident can be extreme.

Large Vehicles- Cars with larger bodies can often cause more damage in an accident than smaller cars. That makes the cost of liability insurance higher.

What makes some cars more expensive to insure?

  • The value of the car
  • Cars that have specialty parts or complex engines
  • Technology, like backup cameras, automatic braking, GPS, etc.
  • Rate of theft- cars that are more likely to be stolen cost more to insure
  • More horsepower- vehicles that have higher horsepower make liability risks higher

If you’re considering switching cars, it can be helpful to consider the insurance costs before you make a final decision. The payments for your dream car might fit into your budget, but the price to insure it could break the bank. You can get a quote for the cars you’re considering ahead of time to see how they would impact your auto policy.

Request a proposal today, we’re here to help!

Sources:

Danise, A. (2022, January 11). Most and least expensive cars to insure 2022. Forbes. Retrieved January 17, 2022, from https://www.forbes.com/advisor/car-insurance/most-least-expensive-cars-to-insure/


Research, H. A. (2021, November 29). What are the most expensive cars to insure? Car and Driver. Retrieved January 17, 2022, from https://www.caranddriver.com/car-insurance/a37169944/most-expensive-cars-to-insure/

Stay Safe on (and off) the Road This Winter With These Items for Your Car

You keep your home stocked with supplies to use in case of emergency. (Right?)

What about your car?

During winter, extreme weather and road conditions can lead to all kinds of trouble when you’re traveling — crashes, getting stuck, getting lost. And cold temperatures make those situations even more dangerous than usual.
So keep a stockpile of emergency items in your car, just like your house. In the best-case scenarios, you’ll never have to use them, or they’ll just help keep you comfortable for an hour or so while you wait for a tow truck. But if you’re ever caught in a truly sticky situation, you might need them to do something more — like keep you alive.

The folks at Wisconsin’s Emergency Management agency are quite familiar with the perils of winter travel, as you can imagine. So don’t just take our word for it — here are some of the things they recommend you keep in your car to help keep you safe should you run into trouble on the roads in the snow and ice.

  • A shovel, tire chains, tow rope and sand or cat litter: All of these can help you get your car unstuck.
  • A windshield scraper: Preferably one with a brush attached.
  • Blankets, sleeping bags and extra clothing: Staying warm is crucial while you wait for help — especially if you don’t know how long you’ll be waiting.
  • Bottled water and snack food, such as energy bars, peanut butter and raisins: If it could be hours before you get moving again, you’ll need to stay hydrated and nourished.
  • A first-aid kit: Keep one in your car no matter what time of year.
  • A battery-powered radio: So you can get weather updates, information on emergency response efforts, etc. – and conserve your car’s battery.
  • Emergency flares, reflectors and a battery-powered flashlight: All of these will help you attract attention — and help other vehicles avoid you.
  • Matches and candles: Even a small heat source can be an effective one.

Your kit doesn’t have to be limited to the list above, of course. Feel free to add items that suit your needs. But most important, keep the kit in your car at all times — and then keep these additional safety tips in mind:

  • Keep your vehicle well maintained (and gassed up).
  • Create a trip plan and share it with friends of family.
  • Stay in your car if you get stuck. Walking to find help is an easy way to get lost and separate from others in your party.
  • To reduce battery drain, only use your emergency flashers if you hear vehicles approaching. You can keep your dome light on to remain visible.

Remember, even the best drivers can end up in a bad situation when the weather gets bad. It doesn’t take much time or money to prepare an emergency kit — but the potential cost of not having one is enormous.

Reposted with permission from the original author, Safeco Insurance®.

Top image by Flickr user orion.

Classic Car Insurance: FAQs

When you have a rare, classic vehicle, insurance is an absolute must. Insurance helps to protect valuable vehicles in the event of an accident or other hazard. Due to the fact that classic cars are far more specialized and valuable than the typical automobile, here are a few frequently asked vehicles that Colorado residents often ask us here at Integrity First Insurance.

What Exactly Is a Collector or Classic Car?

Every insurance company will have its own individual definition of a classic vehicle, but generally, vehicles that are a minimum of 10 years old are considered classic and vehicles that are a minimum of 25 years old are considered collectors. In addition, antique vehicles are usually those that are 50 years or older.

What Does It Cost to Insure Classic Vehicles?

Believe it or not, these insurance policies are quite affordable. The reason for this is due to the fact that they aren’t driven often. Because of this, there is less of a risk that they’ll be involved in an accident. As a result, this leads to a less expensive premium.

What Type of Obligations Do You Have as an Owner?

Your auto insurance company may limit the number of miles that you can drive throughout the year. In addition, you may need to provide your insurer with proof that your vehicle is consistently stored in a garage, that you have a daily driver, and that you have a solid driving record.

Do Classic Cars Need to Be Appraised?

In order for your vehicle to be valued accurately, it is recommended to be appraised by a professional. This ensures that you and your insurance company agree on a value prior to entering into a contract for insurance. When classic and collector vehicles are well maintained, depreciation is generally not something that needs to be taken into consideration, as these vehicles will instead increase in value over a period of time.

When you need insurance for your classic car in Colorado, reach out to the professional insurance agents at Integrity First Insurance who have the experience and expertise to protect your precious assets.

10 Things You Should Know About Insurance In Colorado

1. Extreme weather impacts insurance rates in Colorado.

Hail and heavy rains can cause damage to cars, homes, boats, motorcycles, etc. Many claims are filed when there’s a big storm, which leads to the average insurance rates to increase.

2. Car insurance is more expensive in Colorado than in many other states.

The average car insurance rates have increased by more than 50% in the past 10 years. There are plenty of reasons that car insurance is increasing across the country, and more specifically in Colorado.

Read more about the increasing rates in Colorado in our blog 5 Reasons Insurance Rates Keep Increasing in Colorado

3. Population increases lead to rate increases.

The rapidly increasing population and crowded roads in Colorado has led to more accidents and higher car insurance rates.

4. The minimum liability limits to legally drive in Colorado are $25K/$50K/$15K.

Although you can legally drive with the minimum limits, they aren’t enough to protect your family and your future. Higher limits can save you a lot of money in the long run.

3 Ways You Can Protect Yourself From Personal Injury Attorneys

5. Homeowners in Colorado are more likely to file a roof claim than those in most other states.

Between 2017-2019, Colorado had the second most hail claims in the US. The only state with more in that span was Texas. With such severe hail storms in Colorado, most residents will file a roof claim in their lifetime.

6. As of 2019, 16.3% of drivers in Colorado are driving without insurance.

According to the Insurance Information Institute, the national average in 2019 was 12.6%. Colorado is well over the national average, which is why our Uninsured Motorist coverage rates are on the rise.

Want to know more about the importance of Uninsured Motorist coverage? Check out our blog Do I Need Uninsured Motorist Coverage If I Have Health Insurance?

7. Wildfires have a big impact on insurance in Colorado.

Homes in wildfire-prone areas are difficult to insure and come with a big price tag.

Here’s more information about the impact of wildfires on insurance in Colorado: What You Should Know About Wildfires and Insurance

8. Even though Colorado is a landlocked state, there is still risk of flooding.

Flooding doesn’t only happen near large bodies of water. Rapid rainfall or runoff from areas previously damaged by wildfire can cause severe flooding. You can add a flood endorsement on some home policies in Colorado, or buy a separate policy to cover your risk.

Read about flood insurance here: Flood Insurance 101 

9. Vacation rentals, like AirBnb and VRBO are becoming more popular in Colorado.

Colorado is an ideal vacation destination for many in both the summer and the winter. That means the demand for vacation rentals is skyrocketing. Renting out a second home or even a room in your current home is a great way to bring in some extra income. Luckily, there are plenty of options available for insuring homes used as a vacation rental, but it’s important to get the right coverage.

Vacation Rental Property Insurance: What You Need to Know

10. Rental car rates often skyrocket during hail season.

After a big hail storm, many people need a rental car while their car is getting fixed. With a limited inventory, most rental car companies sell out and the rates become inflated. Check your car insurance policy to make sure you have enough rental car coverage to account for higher costs associated with hail season.

What is “Broad Form” Auto Insurance and Why is it Risky?

What is Broad Form Auto Insurance?

Broad Form auto insurance is very basic liability insurance that covers only one driver. Only the driver named on the policy is covered, so if anyone else ever drives their vehicle(s), for any reason, they would have no coverage. Essentially; instead of covering most drivers that aren’t excluded by the policy like regular auto policies, Broad Form policies exclude every single driver that’s not listed on the policy.

Since it only covers the one driver, it rates for the person rather that the vehicle(s). You’d pay the same amount regardless of how many vehicles you own and it extends to any vehicle the policyholder operates.

Unlike traditional auto insurance, Broad Form policies don’t cover an entire household. You can’t get a policy with your spouse and your kids, you can only get a policy for one individual driver.

What is NOT covered by Broad Form insurance?

  • Damages to your own vehicle
    • That means you can’t get Comprehensive or Collision coverage for your car, so you’d have no coverage to repair your car from an accident, hail damage, theft, or any other cause of loss
  • Your own medical payments
    • There’s no option to add Uninsured Motorist coverage or Medical Payments coverage
    • You wouldn’t have any coverage for your injuries even if you were involved in a hit-and-run or an accident with an uninsured driver
  • Injuries to your passengers
    • Like with your own medical bills, your passengers wouldn’t have any coverage for their injuries in an accident either
  • Liability payments if someone else drives your car and causes an accident
    • A Broad Form policy only covers the driver listed, so if your spouse, child, friend, co-worker, or anyone else drives your car, they’d have zero coverage
  • Roadside Assistance, Loss of Use (Rental Car Coverage), Gap Coverage, etc.

Who does Broad Form coverage make sense for?

Some people consider Broad Form coverage a good option if they have older cars that they don’t want physical damage coverage on and only need liability insurance. Personally, I disagree. In my opinion, the most glaring coverage gap between a Broad Form policy and a normal auto policy isn’t to coverage for your vehicle, it’s the Uninsured Motorist and Medical Payments coverage.

Those are the coverages that will help pay for your bills if you get injured in an accident. Hospital bills can pile up very quickly and paying those expenses out-of-pocket can cause financial ruin.

Read more in our blogs, What is Uninsured Motorist Coverage? and Do I Need Uninsured Motorist Coverage If I Have Health Insurance?

I would only recommend Broad Form coverage to someone who has enough funds built up to handle those expenses on their own. While Broad Form coverage does provide basic liability insurance and meets the minimum limits required by the state, it’s almost like choosing to “self-insure.” It’s a way to pay the least amount of money, but have the least amount of security in the event of a loss.

Facts About Broad Form Insurance:

Broad Form coverage is so limited it doesn’t meet the insurance requirements for most states

Only 11 states accept Broad Form insurance:

  • Colorado
  • Delaware
  • Idaho
  • Iowa
  • Maryland
  • Mississippi
  • Nebraska
  • Nevada
  • Ohio
  • Tennessee
  • Washington

Most reputable insurance companies don’t offer Broad Form auto insurance

Since Broad Form policies leave large gaps in coverage and aren’t considered good policies, most insurance carriers won’t even offer that type of policy.

Does My Car Insurance Cover a Rental Car?

Whether or not an auto policy will cover a rental car is one of the most common questions I hear. The truth is, that question can mean two different things, and often leads to follow-up questions.

1. Does my insurance coverage extend to a car I’m renting (like on a vacation)?

You’ll have to check with your specific policy to be absolutely certain, but in general the answer is yes. Your liability coverage should extend to a car you a renting. If you have Comprehensive and Collision coverage on your policy, that would likely extend as well at no additional cost.

2. Does my insurance policy pay the daily fee to rent a car?

This is a more complicated answer and really depends on the situation and what coverage you pay for on your policy.

If you’re going on vacation or renting a car because your car is having mechanical issues, your policy would not pay for the rental car.

If your car was damaged in an accident, by hail, or some other covered loss, then your policy would pay for the rental car as long as you have selected rental car coverage on your policy. That coverage can go by several different names depending on your insurance provider, so it may show up on your declarations page under one of the following names:

  • Rental Car Reimbursement
  • Loss of Use
  • Additional Expense

Generally, that coverage has both a daily maximum limit and a per occurrence maximum limit. For example, your policy could cover a rental car for up to $50 per day, with a maximum limit of $1,500 for the entire claim. That adds up to $50 per day for up to 30 days. Some policies have only a maximum per occurrence limit without a daily cap, or some have no limits at all.

Most policies also have a weight or size limit for what rentals the policy will extend to. For example, many policies won’t cover a moving truck because of the gross vehicle weight limit.  The exact limitations will vary by policy, so be sure to check yours before assuming you’ll have coverage.

If you aren’t sure what coverage or limits your policy provides, call your agent and have them go over the coverage with you.

Should I buy rental car insurance from the car rental company?

That depends on the coverage you have on your policy, and in some cases your credit card.

Some credit cards provide insurance coverage for a rental car when you pay for the rental car using that credit card. You can usually call the number on the back of the card to talk about what coverage your credit card company provides.

If you have Comprehensive and Collision coverage on your auto insurance policy, you may not need to purchase insurance from the car rental company. The risk of relying on your policy is that it generally won’t cover any additional expenses you may be charged if the rental car is damaged and not able to be rented to others while it’s being repaired. Sometimes the rental car company will charge you for the daily cost they are losing out on while they can’t rent a car that was damaged in your possession. Most auto policies won’t cover that cost, but a policy through the car rental company may.

Another benefit to buying coverage through the car rental company is that if you have a claim, it’s not on your policy. Since the claim wouldn’t be on your policy, you wouldn’t see a rate increase at the next renewal because of the claim.

At the end of the day, each person has to consider the costs and benefits of relying on their policy or buying coverage through the rental car company and decide what’s best for them.

Will my policy cover me if I rent a car in another country?

Most US auto policies only extend coverage in the United States, Canada and Puerto Rico. If you’re renting a car in another country, you should purchase coverage specific to that country. Every country has their own insurance requirements and laws, so even if your policy did extend you may not be meeting that country’s requirements and could end up in legal trouble.

If my car is totaled in a claim, when do I have to return the rental car that was provided?

Once your car has been deemed a total loss and your adjuster has notified you, the clock starts ticking. Your policy will only continue paying for the rental car for a limited amount of time. After that has expired, you’ll have to either pay out of pocket for the rental car or return it.

The exact time frame will depend on your insurance carrier. Each company has their own guidelines, ranging anywhere from 1 day to 1 week, or possibly longer. On average, you’ll only have a couple days to return the rental car before you have to pay out of pocket.

Luckily, it shouldn’t come as a complete surprise if your car is totaled. As long as you’ve been in regular contact with your adjuster, they should give you a heads-up that a total loss is a possibility. That way you can start your search for a new car before your car is officially deemed a total loss.

If you have any questions about insurance for rental cars, give us a call today. We’re always here to help and happy to answer any questions.

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