The cost of auto insurance is expected to rise by just 0.5percent in 2006, the smallest increase in six years, according tothe Insurance Information Institute.

Average cost for auto insurance nationwide for 2006 is estimatedat $867–an increase of just $4 per vehicle from last year despiterecord vehicle-related losses arising from the 2005 hurricaneseason, New York-based I.I.I said.

That projected increase represents a continued slowdown from2005 when auto insurance costs rose by 2.5 percent.

“The cost of auto insurance is increasing by about one-sixth therate of inflation and little more than a single gallon ofgasoline,” said Robert Hartwig, senior vice president and chiefeconomist of the I.I.I.

He added, “Many people who, for example, drive safe cars, haveexcellent safety records and good credit-based insurance scores maysee their rates go down, often by 3-to-5 percent or about $25 to$50 per vehicle. This is welcome news for drivers who have beenbattered by record high gas prices over the past year.” hesaid.

Mr. Hartwig cited the declining number of auto accidents, safercars, new auto theft technology, fraud-fighting efforts andgraduated licensing laws for teen drivers as additional key factorscontributing to the cost slowdown.

However, he observed that rising costs for medical care andvehicle repairs as well as defense costs and jury awards remain aproblem, according to I.I.I.'s analysis.

In an interview, Mr. Hartwig opined that the current steep risein gasoline prices would have only a marginal impact in future onprivate passenger auto and commercial auto rates.

“One might expect to see people driving less and trading down tosmaller, more efficient vehicles that cost less to insure,” hesaid, but he questioned whether the risks of high speed drivingwould be impacted.

“Whether Americans will slow down, I'm doubtful,” he remarked,although he thought gas prices might cause people to drive less. Henoted that some insurers are offering cheaper rates to persons whopurchase hybrid gas-saving vehicles.

Commercial auto livery and delivery fleets, Mr. Hartwig said,will likely work to do more efficient routings and burn less fuel,which could reduce mileage.

A spokesman for the nation's largest auto insurer, Allstate,said the company at this point sees no impact from gasolineprices.