The U.S. Bureau of Labor Statistics’s (BLS) Consumer Price Index (CPI) report shows an increase of 3.3% in the all items index over the last twelve months, with motor vehicle insurance increasing 20.3% during that time.
Although the index for motor vehicle insurance declined during the month of May, the all items index remained unchanged.
Notable increases in the all items less food and energy index over the last twelve months include motor vehicle insurance, the shelter index with an increase of 5.4%, medical care costs which were up 3.1%, and personal care, which increased by 2.9% over the last twelve months.
Vox reports that rising insurance costs disproportionately impact low-income individuals, especially those with poor credit or residing in high-crime areas, who often pay above the average for car insurance.
Californians spend an average of $2,667 annually for full coverage car insurance, compared to the national average of $2,311, according to a report from Bankrate.
An increasing number of lawsuits is contributing to high costs for California consumers, the Northern California Record reported. Excessive litigation and massive payouts are driving up insurance costs, piling on to the state’s high cost of living.