Trump Attributes Auto Insurance Premium Fluctuations to Immigration Policies
In a recent post on Truth Social, President Donald Trump claimed that lower auto insurance premiums can be attributed to his stringent immigration policies. He inaccurately suggested that illegal immigration during the Biden administration led to earlier increases in insurance costs.
The president shared a graph indicating year-over-year changes in auto insurance premiums from 2021 to 2026. The chart illustrates a sharp rise in premiums from 2021 to 2023, followed by a decrease beginning in 2024, with a projection of negative growth by 2026. This data is based on an analysis of Bureau of Labor Statistics numbers conducted by the Council of Economic Advisers.
In his post, Trump stated, “Car insurance premiums have risen to record highs, forcing law-abiding Americans to subsidize ‘free riders’ Biden illegals.” He also asserted that premiums have significantly fallen due to a reduction in illegal immigration under his administration.
However, experts argue that the fluctuations in auto insurance premiums are not linked to immigration trends but largely stem from the COVID-19 pandemic, which resulted in riskier driving behavior and supply chain disruptions, driving up repair costs. As financial conditions have improved for insurance companies, they are now lowering rates to stay competitive, without any substantial evidence connecting illegal immigration to these changes.
Michael Clemens, an economist at Johns Hopkins University and a senior fellow at the Peterson Institute for International Economics, dismissed Trump’s claims as completely unfounded. He explained that these assertions lack credibility and are not supported by any research from the White House, the auto insurance sector, or even anti-immigrant advocacy groups.
The early months of the COVID-19 pandemic saw a dramatic decline in driving, leading to fewer accidents and claims. This allowed insurance companies to achieve higher profit margins, enabling them to reduce premiums to attract new customers. However, as driving resumed in 2022, claims surged due to increased accidents, compounded by reckless driving and supply chain issues resulting in more expensive auto parts.
By 2024, premiums began to stabilize as claims decreased and the financial health of insurers improved. Mark Friedlander, a spokesperson for the Insurance Information Institute, noted that the auto insurance industry has benefited from underwriting profits to offset past losses, leading to average premium stabilization and rate reductions in various states.
When asked for evidence linking illegal immigration to rising auto insurance premiums, White House Press Secretary Khush Desai mentioned that the administration’s enforcement policies have contributed to safer roads by reducing congestion in immigrant-heavy areas. He argued that fewer high-risk drivers, such as non-English speaking truck drivers, have resulted in lower premiums for American drivers.
A 2023 study in the Journal of Insurance Issues did find a correlation between areas with higher illegal immigration and a greater number of uninsured drivers, resulting in higher premiums. However, this relationship is primarily observed in states that do not allow undocumented immigrants to obtain driver’s licenses, a requirement for obtaining insurance.
Clemens also expressed skepticism about the extent to which illegal immigration impacts premium rates, estimating it to account for only a minor portion of the roughly 50% increase in premiums seen post-pandemic. He highlighted that any rise in illegal immigration under the Biden administration would only explain a trivial fraction of that increase.
Trump reiterated previously debunked claims in his Truth Social post, alleging that Biden’s immigration policies have allowed countless criminals to enter the U.S. from prisons and mental health facilities. Such statements have sparked controversy over their accuracy and implications.
