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By Paul Reynolds
June 18, 2021
Two men conferring next to two smashed cars
Getty Images

For the past year, a combination of boredom and empty highways has turned some American drivers into speed demons. Now with the pandemic easing and normal traffic levels coming back, those reckless driving habits may push up car insurance rates -- even for those of us that never run a yellow light.

The way in which insurance spreads risk means good drivers essentially pay part of the cost of crashes by bad drivers. But better drivers can take steps to protect themselves from paying for the worst people at the wheel. And now may be a particularly good time to do just that, given what a respected researcher predicts about the months to come on American roads.

Assured Research this month said it fears bad driving habits in 2021 will boost car crashes and injuries, perhaps even above pre-pandemic levels. That trend could lead to rising premiums for many policyholders, as the costs to settle claims rises due to increased numbers of crashes, according to company president William Wilt. He sees “a concerning increase in automobile traffic and risk on America’s roadways beginning this summer, but particularly spiking after Labor Day, 2021.”

Meantime, it remains unclear whether insurance companies will continue to give back more of the premiums they charged in 2020, but then didn’t spend due to reduced driving.

Some of the savings were passed along to drivers later in 2020, and some states are now ordering further givebacks. But consumer groups still aren’t satisfied. The insurers’ overall record in returning 2020 premiums is “dismal...and stingy,” says Teresa Murray, Consumer Watchdog with the Public Interest Research Group.

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Usage-based auto insurance could offset 2021's rising rates

Drivers aren’t powerless to protect themselves from the costs of more perilous roads in 2021.

First, you can consider trying so-called usage-based insurance, which sets your rates based in part on how you drive -- and so reduces the extent to which bad driving by others affects your own rates.

Adopting so-called telematics does require comfort with the insurer monitoring your driving through an on-board device or smartphone app. But assuming you can live with that, you can enjoy temporary savings merely by trying out your insurer’s pay-as-you-drive option, even if you decide not to stick with the technology. Not every major insurer yet offers such an option in every state, but offerings are growing.

Wilt puts it plainly: “If your insurance company offers a telematics-based program, register for it.”

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If your rate goes up, shop around

Even if you opt to give your current insurer’s telematics option a spin, it’s smart to compare rates for various providers of car insurance -- and this year more than ever, say some experts. “I would encourage people to shop around and compare rates, especially if they now work remotely and expect that to continue,” says Murray.

While there are no guarantees of a better price elsewhere, the move could well save you money — as it did for nearly two thirds of readers in a 2019 Consumer Reports poll. The premium quoted by the cheapest insurer can be hundreds — and sometimes even thousands — of dollars less than the most expensive one, according to a price survey by Carinsurance.com.

Higher car insurance rates aren’t universally predicted for 2021, and some analysts even foresee slight decreases in premiums, as driving remains reduced. And Wilt concedes that any hikes aren’t a certainty, in part because insurers would have to convince regulators -- who must approve rates in many states -- of their need for increased revenue. “That may not be easy after a year (2020) where the industry recorded record profits.”

Still, shopping around, including trying telematics, are potential cost-savers regardless of how car insurance premiums shake out in 2021.

More from MONEY:

The Best Cheap Car Insurance for 2021

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