The average cost of car rental insurance in the United States has been on the rise for the past few years, and for the second straight year it is projected to top $10,000.
According to a new report from AAA, the price of car insurance has tripled in the past decade.
For comparison, the average cost for car insurance in 2007 was $2,300.
While it may seem like the cost of auto insurance is skyrocketing, it is actually a slow, steady climb.
“Over the last several years, the cost for auto insurance has steadily risen, reaching a high of $10.50 per year in the summer of 2018,” AAA said in a statement.
“The average cost will reach $14,800 in 2020 and $17,600 in 2030.”
The new report predicts the average car rental will be worth $1.6 million in 2023.
That’s a huge increase over the previous five-year period, which was a little over $500,000 per year.
“While there has been some improvement in the cost over the last decade, the rising costs are not expected to be sustainable in the long run,” AAA noted.
“In order to maintain current rates, we expect auto insurance premiums to increase over time.
However, this increase could be reversed by the rate of inflation.”
In a recent article, AAA’s Senior Vice President of Insurance & Financial Services David Karp called the cost trend a “dangerously rapid ascent.”
“We see this trend as unsustainable and are concerned about the financial viability of the industry,” he wrote.
“Our members are seeing a marked increase in the number of customers who are leaving the industry, and many of them are paying more for car rental coverage than they did a few years ago.”
Read more about car rental: car rental rates and costs,car insurance costs,costs of car rentals,car theft,car accident rates,car rentals,tickets car,toll rate car,car rental insurance,billing car source Fortune article