Why Did My Car Insurance Go Up?

Why Did My Car Insurance Go Up?

Your car insurance premium is not a static figure. There are times when your auto insurance rate will go up. Several different factors contribute to your car insurance rates going up. What are the reasons behind your insurance rates going up?

You Got In A Car Accident

Your car insurance rates are going to go up significantly if you get into an auto accident. Expect your rates to increase by as much as 20 percent or more.  Having a major accident could impact your rates more than a fender-bender.  Insurance companies manage their risk by charging an appropriate car insurance rate based on many factors, and one such factor is an auto accident.  Driving safe, and staying legal while driving will help make sure you can obtain the lowest car insurance price possible.

Filing A Claim Can Raise Your Rate

Filing a claim on your policy can cause an increase in your rates. This could happen because filing a claim costs your insurance company money. Having a claim filed on a previous policy could raise the risk that you will file a claim in the future. However, never avoid filing a claim if you have a legitimate reason for doing so. Your rate increase is most likely not permanent, and if you maintain a good driving record it could be reduced in the future.

Your Credit Score Went Down

Having a poor credit score can cause your premium to increase. Make sure that you are paying your bills on time. A low credit score could indicate an increased risk of filing a claim. This is because most people with a poor credit score are having financial difficulty.

Higher Costs Are Being Passed On To You

Insurance companies like Wal-Mart are businesses, and it’s their goal to make a profit. The best way to make a profit is to lower the cost of doing business. Writing checks to policyholders will increase the cost of doing business. These increased costs could then be passed on to you. Your best option is to shop around to see if any other company can offer you a lower car insurance rate.

Paying In Installments Could Costs More

Switching to installment payments can raise your auto insurance rates. This could cost you more because you are paying various transaction fees each month. Paying your premium in full every six months is often the best way to keep your insurance costs down.

Car insurance rates can go up for a variety of reasons. Many of these variables are things that you can control yourself. A clean driving record will generally keep your rates steady. Do not forget that you can switch insurance providers at any time. Compare multiple rates  if your current provider decides to charge you more.