In a with CNBC, Dr.Michel Léonard, Triple-I vice president and senior economist, explained how the return to pre-pandemic driving levels is resulting in higher auto accident rates.More accidents mean a larger volume of more expensive claims for insurers to pay because of higher repair costs, delays in repair time due to chip shortages, supply chain disruptions and a labor crunch.

The consumer price index showed that the auto insurance index was up 16.9 percent in May from the previous year, following a 6.4 percent rise in April from the previous year.Elyse Greenspan, a managing director at Wells Fargo, said the year-over-year increase resulted from the premium base in May 2020, reflecting pandemic-related refunds.Triple-I analysis shows that due to the sharp declines in the number of miles driven, U.S.

auto insurers returned $14 billion to their customers last year.Greenspan describes the current auto insurance market as still soft even after recent rate increases.Not all insurers are raising rates, she added.

“It’s still a good environment for consumers who are purchasing auto insurance.”