The U.S. Bureau of Labor Statistic (BLS) reported that the Consumer Price Index (CPI) decreased by 0.1% in June, after showing no change over the month of May. Over the last year, the all items index has increased an average of 3% nationwide.
During June, the motor vehicle insurance index increased 0.9% despite having decreased by 0.1% in May. Motor vehicle insurance costs have increased 19.5% over the past twelve months, according to the latest report from the BLS.
Indexes for shelter, household furnishings and operations, medical care, and personal care also increased in the month of June. The food index increased by 0.2% throughout the month, while the all items less food and energy index increased by 0.1%.
The energy index saw a decrease of 2% during June. Electricity as well as both used and new car indexes also decreased during the month.
"Legal system abuses" such as outsized jury verdicts and the presence of third-party funders in litigation are contributing to rising insurance costs, according to a legal alert from Conroy Simberg. Those "abuses" make it easier for attorneys to file large quantities of excessive lawsuits, and some cases result in awards or damages that "have little relation to appropriate compensation." This excessive litigation forces insurers to raise their costs for policyholders and also forces businesses to raise the costs for their goods and services to account for the heightened cost of risk.
