PCI Highlights Impact of Tariffs on Insurance Costs and Consumers at NAIC Meeting
SAN FRANCISCO - The Property Casualty Insurers Association of America (PCI) made a presentation Saturday to the National Association of Insurance Commissioners’ (NAIC) Property and Casualty Insurance (C) Committee on the potential effect of tariffs on auto insurance costs and consumers.
“Tariffs on auto parts could have a significant adverse economic impact on consumers, automobile repair providers, business, and insurers,” said David Snyder, PCI vice president, policy, research, and international. “Based on data from the U.S. Bureau of Economic Analysis, PCI estimates that the proposed tariffs on auto parts could increase auto repair claims costs by $3.4 billion and ultimately be passed onto consumers through increased insurance costs. In addition, a 10 percent tariff has been imposed on Chinese imports, including auto parts and many other products, which is expected to increase to 25 percent in January. These tariffs are already increasing the price of replacement auto glass, primarily replacement windshields that are frequently damaged by rocks and road debris.”
Snyder told the insurance commissioners that the effects of the tariffs goes beyond just insurance costs. “The proposed tariffs could potentially disrupt the supply of parts and impede consumers from promptly repairing their vehicles and getting back on the road after a crash,” said Snyder.
PCI is urging the NAIC and insurance commissioners to closely follow developments relating to relevant tariffs and work with insurers to oppose, reduce or remove tariffs that increase insurance costs as well as inform the public and other policymakers on the effects of these tariffs.