Goal: Affordable Vehicle Insurance

Affordable vehicle insurance is a concern for consumers and insurance companies. Typically, the premiums you pay for insurance protection is based on the number and cost of the claims paid by your insurance company. Premiums are claims driven. If your insurance company’s ratio of frequency and cost of claims decreases, its customers pay less for their insurance protection. Conversely, if frequency and cost increase, so will the premiums for most customers of that insurance company.

The following information was gathered from a variety of government and insurance industry sources. It is designed to help consumers better understand the private passenger auto insurance environment in the Grand Canyon State. All information is the latest available.

Vehicle Crash Data

• Arizona vehicle crashes on public roads increased from 139,265 in 2005 to 140,197 in 2006.

• Those crashes involved 270,858 vehicles, a 1.15% increase over 2005.

• There were 4,748,957 vehicles registered for travel on public roads. The equivalent of 1-in-17 was involved in a police-reported crash.

• There were 4,091,789 licensed drivers in Arizona in 2006. The equivalent of 1-in-15 was involved in a police-reported crash.

• The economic impact of motor vehicle crashes accounted for $587.88 for every man, woman and child in Arizona.

• Eighty-one percent of all crashes involved more than one vehicle, and over 82% occurred in an urban setting.

• There were 1,296 fatalities (893 males, 409 females) including 56 children, 170 pedestrians, 155 motorcyclists and 29 pedacyclists.

• Nearly 68,574 people claimed to be injured in motor vehicle crashes, including 5,638 children, 1,447 pedestrians, 2,814 motorcyclists and 1,514 pedacyclists.

• Hit-and-run drivers caused 17,539 crashes that resulted in 84 deaths and 4,954 injuries.

• There were 7,693 alcohol-related crashes in Arizona that resulted in 315 fatalities and 5,534 injuries.

• The most crashes occurred between the hours of Noon and 6:00 p.m.

Reported Vehicle Crashes for Selected Arizona Cities

Note: Data represents only police-reported crashes that resulted in an injury, or at least $1,000 in property damage. It does not include collisions on private property.

Comparing Arizona with National Trends

Frequency of Injury Claims: The number of people claiming to be injured in Arizona crashes is 25% higher than the national average.

Cost of Injury Claims: The cost to reimburse a person injured in vehicle crash is $116 more in Arizona than it is nationally.

Frequency of Comprehensive Claims: The frequency of comprehensive claims (primarily thefts, vehicle-wildlife collisions and windshield repair/replacement) is 180% higher in Arizona than it is nationally. Some consumers may not realize that when they share their insurance information with glass repair companies, the glass provider may actually be submitting a claim against their policy without the consumer’s knowledge.

Cost of Comprehensive Claims:  The average payout for a comprehensive claim in Arizona is $445 less than the national average. 

Frequency of Collision Claims: The number of collision claims filed in Arizona is 14% less than it is nationally.

Cost of Collision Claims: The average payout for a collision claim in Arizona is $469 more in Arizona than it is nationally.

Frequency of Property Damage Liability Claims: The number of property damage liability claims filed in Arizona is 5% less than the national average.

Cost of Property Damage Liability Claims:  The average property damage liability payout in Arizona is $517 more than the national average.

Fatalities: Based on miles driven, Arizona’s fatality rate is 31.5% higher than the national average.

Other Insurance Cost-Drivers

Vehicle Theft: Based on vehicle thefts for every 100,000 residents, Arizona’s theft rate improved in 2007. Participation in the Arizona Auto Theft Authority’s “Watch Your Car Program” and the use of “bait” cars in capturing thieves are major reasons for the improvement. Despite these efforts, Arizona’s theft rate is still 128% higher than the national average. The Phoenix-Mesa metropolitan area ranks eighth in the country for thefts, while Tucson ranks 10th, Yuma 26th, Flagstaff 246th and Prescott 278th.

In 2006, Arizona's total economic loss due to vehicle thefts was $369,833,094.

Traffic Density: in 2006 more than half (around 58%) of the population of Arizona live in cities of 100,000 or more inhabitants, the highest proportion of any of the 50 states..

Miles Driven Per Highway Mile: The number of miles driven in Arizona ranks as the 16th highest in the country, trailing California, Texas, Florida, New York, Pennsylvania, Georgia, Ohio, North Carolina, Michigan, Illinois, Virginia, New Jersey, Indiana, Tennessee and Missouri.

Insurance Fraud: Insurance fraud primarily involves individuals who, in collusion with unscrupulous attorneys and medical “mills,” file claims for injuries that either don’t exist or are greatly exaggerated. Claims for these types of “injuries” add $180 to the average auto premium in Arizona. Other forms of fraud prevalent in Arizona include glass repair companies attempting to bill insurance companies for work that was either not done, or for replacing windshields when, in fact, the windshield was repaired. Vehicle “give-ups” is prevalent as well; this occurs when a vehicle owner purposely has his vehicle stolen to collect insurance proceeds. Citizens suspecting insurance fraud should report their suspicions to the DOI Fraud Unit (602-912-8418) or the National Insurance Crime Bureau (1-800-TEL-NICB).

Concerns

• While safety belt use has increased, there's more to do. In 2006, 345 unbelted drivers and 156unbelted passengers died in Arizona. Another 5,961 were injured.
• Speeding and driver inattention continue to jeopardize safety on our roadways. Rear-end collisions represented 44% of all multi-vehicle crashes in Arizona. Speeding caused 18.13% of all crashes, 19% of all injuries and 24% of all fatalities. Drivers failing to yield the right-of-way was cited as the major driving error in 10% of all crashes, 11.8% of all injuries and 7.47% of all fatalities. Driver inattention was cited as the major cause of 5.72% of all crashes, 4.65% of all injuries and 3% of all fatalities.

Improvements

• The DUI Task Forces in Arizona continue to remove impaired drivers from our roadways. In 1990, for instance, 9.68% of all crashes were alcohol-related. In 2006, 5.5% were alcohol-related.
• Between 80% and 90% of drivers and passengers in Arizona are wearing their safety belts. In fatal crashes in 2006, more than 73% of drivers and passengers who wore safety belts survived. It is estimated that safety belts save 14,000 lives and $50 billion in medical care, lost productivity and other injury related costs nationwide annually.

Sources: Arizona Department of Transportation Motor Vehicle Division, Insurance Services Office, Arizona Auto Theft Authority, National Insurance Crime Bureau, Federal Highway Administration.