State Farm Insurance, New Mexico’s largest auto insurer, is lowering customer rates by an average of 5 percent statewide thanks to fewer claims.
Illinois-based State Farm, which handles more than 282,400 insurance policies in New Mexico, announced the reduction Thursday. It went into effect May 1.
The company said the reduction represents a savings of $9.8 million for New Mexico customers. Overall premium reductions vary depending on factors such as the coverages and discounts.
Company spokeswoman May Martinez Hendershot said the overall rate reduction became possible because motorists are filing fewer claims, something that the Insurance Information Institute sees as a national trend.
Hendershot said no one is entirely sure why there are fewer claims, but State Farm suspects safer cars, more seat-belt use and better roadways have helped.
Carole Walker, executive director of Rocky Mountain Insurance Information Association, said an aging population probably keeps accidents down because older people tend to drive more carefully.
She added that a push against drunken driving and probationary licensing for new teenage drivers have probably helped lower accident rates in New Mexico.
Still, the state’s number of uninsured drivers keeps the cost of auto insurance high.
With some 1.5 million registered vehicles, New Mexico had the highest uninsured vehicle rate in the country in recent years. It now ranks 39th, according to the Motor Vehicles Division insurance compliance section.
The state launched its latest crackdown on uninsured motorists in April. The state sent letters threatening suspension of registrations for nearly 300,000 vehicles if their owners did not get insurance.
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