For many Illinois drivers, the cost of car insurance is a significant part of their household budget. When you rely on your vehicle for daily commutes, family errands, and weekend adventures, having reliable coverage is essential. That’s why news of rate increases often sparks questions and concerns.
Unfortunately for many policyholders in the Prairie State, one of the top insurers is preparing to bump up rates. But there’s still time to shop around and switch before you get hit with an increase.
What’s Happening?
Allstate Insurance, the 3rd biggest auto insurance carrier in Illinois, will be implementing a 3% increase in its auto insurance premiums for renewal business beginning August 10, 2025. This increase will impact more than 100,000 policyholders and raise total written premiums by over $8 million across the state– translating to an average increase of $75 per policy. While this may sound like a relatively minor bump, it’s still worth exploring other options to avoid rising costs.
Why Do Auto Insurance Rates Increase?
If you’ve taken notice of recent car insurance pricing trends, you may be wondering why rates have been going up. The high-level answer is simple– insurers operate by collecting premiums from many policyholders to create a pool of funds that can then be used to pay out claims for the few who experience accidents, theft, or other covered losses. When the cost of those claims rises, so too must premiums to ensure the insurer can continue to meet its obligations and remain financially stable.
Several key factors contribute to rising auto insurance rates across the industry:
- Increased Cost of Repairs: Modern vehicles are equipped with sophisticated technology, including advanced driver-assistance systems (ADAS), sensors, and cameras. While these features enhance safety, they also make repairs more complex and expensive. A minor fender bender can now involve replacing intricate sensors, recalibrating systems, and specialized labor, driving up the cost of claims.
- Inflation: Like almost everything else, the cost of parts, labor, and medical care (in cases of injury claims) is subject to inflation. When these costs go up, the payouts for claims increase, which in turn necessitates higher premiums.
- More Accidents and Severity of Accidents: In some areas, there’s been an uptick in the frequency of accidents, or the accidents that do occur are more severe, leading to higher damage and injury costs. Factors like increased miles driven, distracted driving, and even more aggressive driving behaviors can contribute to this trend.
- Theft Rates: Certain regions may experience higher rates of vehicle theft, particularly for specific makes and models. When more cars are stolen, insurers face higher payouts for these losses, which can affect rates for everyone in that area. Illinois, for example, has seen its share of vehicle theft challenges.
- Catastrophic Weather Events: While more commonly associated with home insurance, severe weather events like hail storms, floods, or high winds can also lead to a surge in comprehensive auto claims, impacting an insurer’s overall costs.
- Litigation and Fraud: A rise in legal activity related to auto accident claims, or an increase in fraudulent claims, can also contribute to higher costs for insurers, which are then passed on to policyholders.
Insurance companies constantly analyze these trends on a state-by-state and even ZIP code-by-ZIP code basis. When the data indicates that the cost of doing business is rising in a particular area, rate adjustments become necessary.
Shop now and save!
How to Save on Auto Insurance
While an upcoming rate increase can feel daunting, there are several proactive steps you can take to potentially save on your auto insurance policy, even with Allstate’s adjustment in Illinois:
- Requote Your Policy: If your renewal date is after August 10, 2025, it’s highly advisable to contact Allstate to obtain a new quote before that date. It’s possible that by requoting, you might be able to lock in a rate that doesn’t fully reflect the upcoming increase, or at least understand exactly how the increase will impact you. Insurance pricing can be complex, and sometimes a new quote initiated before a rate change takes full effect can yield a better outcome for your upcoming policy term.
- Shop Around with Other Carriers: Don’t assume your current insurer, even if you’ve been with them for years, automatically offers the best rates. The insurance market is competitive, and different companies have different underwriting models, risk appetites, and discount structures. Use a comparison tool to get quotes from several other reputable insurance providers in Illinois and find the best option for you.
- Review and Adjust Your Coverages:
- Increase Your Deductible: The deductible is the amount you pay out-of-pocket before your insurance kicks in for a claim. Generally, the higher your deductible, the lower your premium. If you have a solid emergency fund and can comfortably afford a higher deductible (e.g., $1,000 instead of $500), this can lead to noticeable savings on your comprehensive and collision coverages.
- Re-Evaluate Coverage for Older Vehicles: If you have an older car that’s paid off and its market value is low, the cost of comprehensive and collision coverage might outweigh what you’d receive in a claim payout. Calculate if it makes financial sense to continue paying for these coverages, keeping in mind that liability coverage is still a legal requirement.
- Evaluate Other Optional Coverages: Review any additional coverages you have, such as roadside assistance, rental car reimbursement, or gap insurance. While valuable, if your circumstances have changed or you have alternative solutions (like an auto club membership), you might consider removing them to lower your premium.
- Ask About Discounts: Many drivers miss out on potential savings simply by not asking about available discounts. Here are some common ones to inquire about:
- Multi-Policy/Bundling Discount: If you have your home, renters, or life insurance with a different carrier, see if bundling your policies with Allstate or another insurer could lead to savings.
- Safe Driver Discount: Do you have a clean driving record? Many insurers reward drivers with no accidents or violations.
- Good Student Discount: If you have a student on your policy with good grades, they might qualify for a discount.
- Defensive Driving Course Discount: Completing an approved defensive driving course can sometimes lead to a discount.
- Vehicle Safety Features Discount: Cars with advanced safety features like anti-lock brakes, airbags, and anti-theft devices may qualify for lower rates.
- Low Mileage Discount: If you don’t drive much, some insurers offer discounts based on annual mileage. Allstate, for instance, offers programs like Milewise for low-mileage drivers.
- Loyalty Discounts: While Allstate is raising rates, sometimes being a long-term customer can still open doors to certain discounts. It never hurts to ask!
- Maintain a Good Driving Record: This is fundamental. Avoiding accidents and traffic violations is the best way to keep your premiums down in the long run. Insurers base rates heavily on your driving history, as it’s a key indicator of future risk.
- Improve Your Credit Score: In many states, including Illinois, your credit-based insurance score can impact your auto insurance rates. A higher credit score generally correlates with lower premiums, as statistical data suggests a link between creditworthiness and the likelihood of filing a claim.
Staying Informed and Proactive
While rate increases are a part of the insurance landscape, you have more control over your car insurance costs than you think. By staying informed about industry trends, actively seeking out competitive quotes, and regularly reviewing your policy coverages and available discounts, you can work towards finding the best possible rates for your needs.
Next time, don’t wait to hear about an upcoming rate increase! Sign up for Auto Quote Tracker to get rate change alerts delivered directly to your inbox.
