Insurance companies are looking to trim costs for auto insurance as a way to lower rates for consumers.
But the average cost of a new policy is now more than double the cost of the lowest-cost policies offered by auto companies in 2016.
And that’s a big problem for drivers.
In New Jersey, the average annual premium for a policy is nearly $13,000.
In Connecticut, the rate is $6,600.
And in New York, the cost is more than $11,000 per year.
Nationwide, there were more than 5.7 million auto insurance policies sold in 2016, up from 5.2 million in 2015, according to an analysis of data by the insurance industry trade group AAA.
The average annual cost of an auto policy was $4,600 in 2016 in New Jersey and $4.5 in Connecticut, according an analysis by AAA of state data.
The average annual price for a new insurance policy is $8,500 in New Hampshire, up almost 15% from 2015.
New York had the highest average annual rate at $12,400, followed by Rhode Island at $8.2 and New Jersey at $6.6.
But for drivers who have had accidents or serious injuries, they may be paying more for auto coverage.
AAA estimates that of the nearly $11 billion in claims for injury, medical and property damage that resulted in more than 18 million claims in 2016 nationwide, the most common cause of claims was auto accidents.
That includes 4.3 million claims for injuries and 6.4 million claims involving property damage, according the association.
New Jersey’s average annual average premium for policyholders with injuries and medical claims was $823 per year in 2016 compared to $876 for those with no claims.
For claims involving injury, New Jersey’s rate was $2,746.
For property damage claims, the state had the most expensive average annual premiums at $2.5 million.
The state also had the third-highest average annual rates for auto policies, at $5,071.AAA estimates that an average policyholder in New Mexico, New York and New York City paid $7,700 in medical and accident claims per year, with an average annual deductible of $11.9 million.AAA said the average policyholders in the four states with the highest premiums were all counties in the New York metropolitan area, including Manhattan, Queens and Brooklyn.
New Jersey was the only state to have an average rate of more than twice that.AAA also said the state has one of the highest rates for claims of all insurers for policies with less than $100,000 in coverage, with rates of $7.6 million for policies costing more than that.
The state has an average premium of more $5.8 million, up about 20% from 2016, according a report from the New Jersey Insurance Research Council.
In contrast, the national average was $1.9 billion.AAA says the insurance company industry in New Zealand, one of its largest markets, had the second-lowest average premium, at just $2 million per year for policies that are under $100 in coverage.
The association also released a report earlier this year that found average annual prices for policy holders with claims for accident and medical injuries and property damages, and other types of claims were the highest in the country.
It said the industry has a lot of work to do to improve rates.
“We are a long way from a sustainable state of affairs where consumers will be paying premiums for coverage that will cover the majority of their coverage needs,” AAA said in a statement.