HOBE SOUND, Fla. — Inflation is certainly taking its toll on people's wallets — from food to housing costs to car prices.
Coupled with supply chain issues, inflation could now be driving up car insurance premiums.
At A-1 Auto Care in Hobe Sound, mechanics are busy balancing, aligning tires and repairing engines.
"We run about 20-25 cars a day throughout the shop," said Dave Morgan, the owner of A-1 Auto Care.
But over the past year, the ongoing supply chain issues have thrown a wrench into his business.
"Costs have gone up both on the labor side and the parts side," Morgan said.
Some parts are hard to come by, and repairs are taking longer than expected.
"We do have cars that hang around a lot longer than they normally would," Morgan said.
When you add inflation into the mix, the costs are being passed on to the consumer.
"It seems to be going up every renewal I get," said driver Jeff Cappelletti.
Cappelletti is trying to do everything he can to keep his car insurance costs at a minimum.
"I think whatever we're seeing now is here to stay and just go up maybe not as much if things stabilize in a year or two," Cappelletti said.
Inflation is a direct cause of car insurance premiums increasing since traffic is almost back to what it was before the pandemic.
With more traffic comes more accidents, which means more repairs and replacement parts.
With the supply of new cars down, experts say rental car rates are up about 30%. Repairs are taking longer and insurance companies are paying for more rental car days.
"One of the leading carriers in Florida just announced they're going to have a 2.9% increase in premiums, and that's I think something we're going to see across the industry," said Andy Combs, who owns We Insure, an independent agency in Stuart.
Combs said not only does your driving record and claim experience impact costs but also newer technology in cars, and the vehicles themselves are more expensive.
"If you did have an accident, the cost to replace that bumper or windshield because of technology is also increased," Combs said.
Florida is already one of the top states for uninsured drivers, and Combs believes higher rates could lead to even more people driving around uninsured or underinsured.
"It is going to have implications. People may not be able to afford full coverage," Combs said. "Maybe they'll reduce the type of coverage they're getting to manage the cost."
He advises customers to check with multiple carriers and focus on available discounts.
The silver lining is that used cars are worth more than they were this time last year.
"Although your premium may have increased, it may not show you truly that you actually got a little higher coverage because the car is worth more today than 12 months ago," Combs said.
