Every time you turn around, the cost of something is going up. Groceries, the price of a cup of coffee, and your insurance. You expect your auto insurance to go up if you get into an accident or have a few traffic violations, but even when you’re a great driver with almost no claims, you may still pay more for insurance after a few renewals.
If you’re wondering why your auto insurance rates keep increasing, take a look at the different reasons that can cause this to happen.
Life Changes Cause Rate Increases
Big and little life changes can make a difference in the price you’ll pay for your auto insurance.
- You moved to a new city or location. It may have been from a gated community to an apartment complex or a small town to a busy city with lots of accidents.
- You have a different commute and your estimated daily and yearly mileage has increased. Longer drives and more time on the road can lead to a higher chance of having an accident.
- Your credit score has changed. Maybe you went through a foreclosure or had a big medical bill that’s haunting you. Of course, it could be a mistake. You can get a free copy of your credit report once a year. It may be worth a look to make sure no mistakes are affecting your score and your premiums.
- You’ve purchased a new vehicle. New vehicles cost more to replace in a major accident so the cost to insure it will increase, too.
- You added a new driver or an inexperienced one to your policy. Did your daughter just turn 16 and start driving the family car? That will definitely raise your rates.
- You caused an accident. This one comes as no surprise.
- You’ve gotten a ticket or two that added points to your license.
- You’ve reported too many claims in a short amount of time, even though the accidents weren’t your fault.
Other Reasons Your Auto Insurance Rates Went Up
Maybe none of these reasons apply to you, but your rates are higher than when you first signed up. Unfortunately, insurance rates increase for everyone for a couple of reasons.
Associated costs are rising. Your insurance coverage pays for injuries to others, property and vehicle damage, medical expenses, and even legal fees, from time to time. Those costs aren’t set by insurance companies and are going up, as well. As those costs rise, insurance companies raise their rates in order to keep up.
Insurance fraud is a big reason for increasing rates. Fraud costs the insurance industry billions of dollars each year. From falsifying claims to exaggerating or inflating the amount of loss, fraud comes in a variety of forms. Insurance companies spend a lot of time and money preventing and investigating these problems. Sometimes, though, fraud slips through the cracks and the insurance company pays out money it shouldn’t have. As a result, premiums go up for everyone. If you live in an area with high rates of fraud, your insurance may increase more often because of it.
You may want to consider shopping around for a new insurance provider, especially if costs are increasing with little to no changes on your part. Contact us for a free quote today, and we’ll help you find the right auto insurance policy that fits your budget and your life.