Several major insurers sought and were recently granted premium bumps by the California Department of Insurance.
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"We've got a lot more rate hikes coming," said Jamie Court, the president of Consumer Watchdog. "We're talking about hundreds of dollars per person, and we're also talking about 20% of the market has now had rate hikes. So we have about 80% of the market that are asking for rate hikes."
California law requires insurance companies to get approval for rate hikes from the state. Any requested hikes higher than 6.9% require a public hearing.
"So they're all asking for 6.9% and many of them are getting 6.9% and we don't think they all deserve 6.9%" Court told Eyewitness News. "This commissioner was not (eager) to approve rate hikes in the year before he was re-elected. And then after he was re-elected, he turned on the spigot."
Court was referring to California Insurance Commissioner Ricardo Lara, who will also decide on rate hike increases from even more insurers in the upcoming weeks. But a spokesperson for the department says approvals for auto insurance rate hikes are actually at a 10-year low.
"The experts at the Department of Insurance are focused on protecting consumers," wrote spokesman Michael Stoller. "We are doing all we can within the limits of voter-approved Proposition 103 to make sure Californians do not pay more than they have to and that they have the power to choose what insurance is best for them."
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Car insurance experts point out that California had gone two years during the pandemic without any rate increases. But California is still one of the costliest states in which to insure a vehicle. Only Florida, Michigan, Louisiana and Delaware have higher auto insurance rates.
In rain-soaked California, few homeowners have flood insurance
In rain-soaked California, few homeowners have flood insurance
"States that have natural disasters have higher rates because insurance companies suffer big losses," said Laura Longero, executive editor of CarInsurance.com, adding that California's expensive health care and massive amount of cars also add to the high prices. "More traffic means more accidents which means higher rates."
But Consumer Watchdog says insurance companies overcharged California drivers during the pandemic years, when few people were on the road. Court says the amount adds up to between $3 billion to $5 billion, money he says Commissioner Lara promised to get back to Californians.
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"We don't think the commissioner should be approving rate hikes until he delivers on his promise to get us refunds," said Court.
According to CarInsurance.com, the average premium for full coverage auto insurance in California is $2,110 per year. The national average for the same coverage is $1,583, a difference of $527.
Longero says people need to shop around for the best rates every six months, when their current policy is set to renew. She says it could save you up to $800 per person, per year.