Californians are in for another bill increase: Car insurance

Some California drivers will be getting a nasty surprise when they open their car insurance bills this year.

That's because California Insurance Commissioner Ricardo Lara approved some big rate hikes in the last six months, ending a long COVID break after insurance companies complained they were losing money and cutting back in the nation's largest vehicle market. Higher rates for Geico, Mercury and others are just now showing up in insurance renewal letters that customers receive.

And more increases are in the pipeline, consumer advocates say, even as some insurers have yet to refund customers for premium overcharges during the early months of the pandemic when people were driving less and getting into fewer accidents.

“These insurance companies still owe consumers from the COVID era,” said Jamie Court, president of Consumer Watchdog, the Santa Monica nonprofit that sponsored Proposition 103, the 1988 voter initiative that limited how much insurers can charge for auto, home and casualty insurance. “The commissioner should not be granting rate hikes when he still hasn't been able to compel them to give rebates for the times when we weren't driving,” Court said.

Californians are paying an average of $2,291 in car insurance premiums this year, up $101 from 2022, according to a Bankrate analysis that found premiums rising nationwide as people drive more miles, drive less safely and wreck increasingly expensive cars.

Rate increase approvals, which gathered steam in December and January, have been granted to insurers representing more than 20% of the market, according to Consumer Watchdog's tally. Geico, Mercury and Allstate received 6.9% increases, while some smaller insurers got larger hikes.