Nevada drivers may have noticed that their car insurance premiums have gone up significantly in 2023. According to the U.S. Bureau of Labor Statistics data, the cost of car insurance has increased every month since 2022. What are the reasons behind this surge and how can drivers save money on their policies?

The rising cost of car parts and labor

One of the main factors driving up the cost of car insurance is the rising cost of car parts and labor. Due to the global microchip shortage, new vehicles are more expensive and scarce. This also affects the availability and price of auto body parts and mechanical parts, which are essential for repairing damaged vehicles.

Why Nevada drivers are paying more for car insurance in 2023
Why Nevada drivers are paying more for car insurance in 2023

The industry has struggled with a worldwide microchip shortage, and car parts costs have risen. Higher prices for parts push up the cost of repairs for insurance companies. These additional costs are passed to policyholders via rate increases.

Scott Kipper, who serves as Nevada’s insurance commissioner, said that the average cost to insure a new vehicle is around $900. He also said that some parts, such as bumpers, have become more complex and costly due to the integration of sensors and cameras.

The increase in car collisions

Another factor that contributes to the rise in car insurance premiums is the increase in car collisions. Kipper said that people are starting to drive more after the pandemic lockdowns and that Las Vegas is seeing more accidents in its relatively small space.

According to data from Zero Fatalities Nevada, Clark County is seeing a slight increase in crashes in 2023 compared to 2022.

More collisions mean more claims for insurance companies, which also leads to higher rates for drivers. Kipper said that Nevada has a high percentage of uninsured drivers, which is illegal and adds to the burden of insured drivers.

How to save money on car insurance

Despite the rising cost of car insurance, there are some ways that drivers can save money on their policies. Kipper advised drivers to shop around and compare quotes from different insurers, as prices may vary depending on various factors.

He also suggested that drivers talk to their insurance brokers or agents about the discounts and options available to them. Some of the common discounts include:

  • Multi-policy discount: If you bundle your home, auto, and other policies with the same insurer, you may get a lower rate.
  • Good driver discount: If you have a clean driving record with no accidents or violations, you may qualify for a lower rate.
  • Low mileage discount: If you drive less than a certain number of miles per year, you may get a lower rate.
  • Safety features discount: If your vehicle has anti-theft devices, airbags, anti-lock brakes, or other safety features, you may get a lower rate.

Kipper also recommended that drivers review their coverage levels and deductibles periodically and adjust them according to their needs and budget. He said that drivers should have enough coverage to protect themselves and their assets in case of an accident, but not more than they need.

The Nevada Division of Insurance will host a forum for the public on November 1st to provide more information on the increase of car premiums and ways to save money.


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