I worked in Car Insurance claims for six years with a major insurance company in New Orleans. I would often settle personal injury claims with claimants and often vehicles had no damage.

Insurance companies and personal injury attorneys still argue if ”low impact” accidents can cause major injuries.

No matter which side of the fence you stand on, Louisiana residents still pay higher rates than other states.

new orleans car insurance

The number #1 question from our auto insurance clients is always

“Why do we pay so much for New Orleans Car Insurance?”


Here are some reasons or beliefs I have heard through the years as to why in the New Orleans area residents pay so much for car insurance

  • Drivers who are involved in an accident file more injury claims
  • High claim payouts for frequent hurricanes, hail damage and flood
  • More drivers hire attorneys when involved in an auto accident
  • Louisiana judges are elected officials and more likely to side with voters against the insurance companies
  • Cost of medical treatment increases every year



high cost of auto insurance

I recently read an article from Metlife Insurance and they gave some other reasons auto insurance companies are taking rate increases.



The price per gallon remains low and when that happens more cars on the road.

People are driving more miles which leads to more accidents.

Last year in 2015 there were 250,000 more accidents than in 2014 and driving more miles has contributed to the increase in accidents.



The improving economy is putting more people to work and they are on the road longer and more miles. More people employed, more disposable income to get out of the house.



According to AT&T distracted driving survey of their subscribers, over 70% of drivers admit to using their smartphones while driving & 61% admitted that they text behind the wheel. Drivers also admit to checking email, taking selfies, surf web and use facebook while driving.

Companies and organizations are trying to raise awareness





Today’s cars are more sophisticated and much more expensive to repair. With improved safety technology and advanced technology equipment the cost to repair has increased every year.



If you think insurance companies keep your premium in the bank and hold it until you make a claim, you would be wrong.

Insurance companies invest your premiums and earn interest and returns before they have to pay out claims.  

If interest rates are low, insurance companies are not going to make a profit.

Insurance underwriting is a loser’s game.  Insurance companies pay out more in claims than they take in premiums so they must make a profit in investing your premium dollars.

Majority of insurance companies invest in US Bonds and rates remain historically low so insurance companies are now looking at increasing operating income and that means raising insurance rates.

Here is a recent article about rising auto insurance rates across the United States.

Here is another major reason we pay so much for car insurance.

When someone is involved in an auto accident, they don’t call their spouse, significant other or parent, they call their attorney.

As a former claim rep handling auto injury claims for an insurance company, it is very possible you will receive less money if you hire an attorney.

Calling your attorney should not be your first call, it should be your last.

You call an attorney when you believe you are not getting a fair settlement offer.

If you give the claim representative an opportunity to adjust the claim and offer you a settlement, which is negotiable, you can save yourself 33% of the settlement.

If you hire an attorney you are likely giving up 33% of the settlement and if it goes to trial, 40% of settlement.

Upon receipt of the claim check, the attorney deducts their 33% and next you have to pay the medical bills. Medical providers send lien letters against the settlement so you can’t get out of paying them unless you were not adequately compensated.

So that leaves little left for you.

If an attorney takes most of the money, why do people involved in an accident call an attorney?

A recent study conducted stated 33% of respondents claimed someone they knew recommended to call an attorney.

The second most common answer was because they wanted the highest possible settlement.

It is a myth perpetuated by plaintiff attorneys on television that you can not settle an auto insurance claim without legal representation.

The truth is you can.

So if auto insurance rates are going up, what can you do to lower your premium?

Here are 7 Things you can do to help lower your New Orleans Car Insurance Premium


  • Pay in Full
  • Companies are offering “low mileage programs” which monitor your driving
  • Boost your credit score
  • Increase your deductibles from $100 to $500
  • Take advantage of an annual 12 month policy term
  • Claims usually “drop off” your motor vehicle driving record after 3 years.


The Safeco Auto Insurance RightTrack is available and it can save you up to 30% after 90 days on your policy and the good news is the program will not penalize you after 90 days.

You get a 5% discount off the quote just to try the RightTrack program.

For more information on the RightTrack program and Safeco Insurance company see our recent article


or if you want to see the Frequently Asked Questions page about Safeco RightTrack click on the link



or a video of how the program works

Safeco Auto insurance RightTrack


Another tip you may be missing is do you have your homeowners insurance with your auto insurance company?

In the New Orleans area your options are very limited to package your auto and homeowners insurance together with one insurance company.

National General Insurance is one company writing new policies in our area for auto insurance, homeowners insurance, flood and rental property.

If you believe you are paying too much for Louisiana Auto Insurance and want to see what we can do for you, call us at 504.348.3131 and we will work up quotes from a few preferred auto insurance companies that we represent.

New Orleans Auto insurance rates in our area seem like they are going up with every company.

Now may be the time to consider a move to another insurance company.

At FM Agency Group we have the ability to package your auto, home and flood with one company. 

Give us a call at 504.348.3131 or complete our quick form at our Contact Us page and send us an online contact request.



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