7 Things That Will Raise Your Car Insurance Premiums
The sudden event that increases costs is one of the biggest frustrations that might occur when you’re trying to conserve money. Perhaps the rent has gone up. It could be an illness or an unexpected new bill. Whatever it is, it can be a major setback, especially if you’re attempting to pay off debt or put money aside for a special purchase.
One of these things that nobody enjoys having to deal with is a significant increase in your auto insurance rates. For many of us, having a car is a need, and having insurance is also a requirement. Owning a car is one of those inescapable expenses that can seriously strain your finances, so it’s critical to avoid letting negligence drive up your premiums.
Here are some of the most typical factors that can cause your insurance costs to increase with that in mind.
1. receiving a traffic citation
Anyone who has received a traffic ticket is probably aware with this one: shortly after receiving the ticket, your insurance rates almost certainly increased. Car insurance companies base premiums on how dangerous they believe a driver to be, and receiving a ticket increases your risk of being in an accident in their eyes. This is particularly true if you receive a ticket for a moving infraction like speeding or running a red light. This indicates to insurers that you have a propensity for unsafe driving and are therefore more likely to be a financial burden.
2. Causing An Accident
What has an even greater effect than proving to your insurers that you’re likely to be in an accident? being present in one. If you caused the collision, the insurance company will have to compensate you for the damage and move you into a higher risk category. The more damage caused by the collision, the higher the premiums will be. There are specific circumstances where an insurance may grant accident forgiveness, but generally speaking, you only receive it once (if at all). Thus, don’t depend on it!
3. Having A Teen Driver (Or Being One).
Young age has a significant impact on the cost of your insurance premiums, fair or not. Teenagers are thought to behave more irresponsibly, with greater impulsivity, and with less life experience than adults. They are statistically substantially more likely than older age groups to be involved in traffic accidents, making them significantly more expensive to insure. For instance, rates for drivers between the ages of 16 and 19 in states like Maryland, which are currently expensive, are going to be outlandishly high. Sadly, there is little that can be done to avoid it.
4. residing in a dangerous area.
You run a higher chance of having your automobile broken into or stolen if you move to (or reside in) a risky neighborhood. It also increases the likelihood of a collision. Living in a region that is vulnerable to specific catastrophes and meteorological phenomena, such as fire, flood, earthquake, hailstorms, and a variety of other events, might result in higher premiums. This causes insurers to assume more risk, which is then transferred to you in the form of increased rates.
5. owning a costly vehicle.
The cost of parts and labor to repair more expensive vehicles can be higher, and depending on the make and model, they may also be seen as having a higher accident risk. These factors make them a higher risk for insurers. Driving high-performance vehicles can be challenging, particularly for inexperienced drivers.
6. having a bad credit rating.
Your credit score can have an effect on all facets of your financial life, including the ability to buy a home, qualify for a loan, and, yes, even afford vehicle insurance. This is related to how insurers determine a policyholder’s risk factor, and regrettably, having a low credit score indicates that you pose a higher financial risk.
7. making a thorough insurance claim submission.
If your vehicle has comprehensive coverage, you are legally entitled to make a claim if a tree falls on it, a hailstorm fractures your glass, or any other incident results in damage. This usually won’t have a significant effect on your premiums. However, some insurance providers have started raising premiums for customers who have made numerous comprehensive claims or even claims that total more money. That’s just how it goes sometimes, fair or not.
How to assist in lowering your rates.
You aren’t completely at the mercy of chance when it comes to controlling your auto insurance rates, even though some of these things could be unavoidable and happen for no reason of your own. You might use the following methods to try and reduce your rates:
Inquire with your insurance about discounts for defensive driving, low mileage, students, and other factors.
enroll in a driving safety course.
Accept having an in-car telematics device installed to track your driving behavior.
Compare insurance costs by shopping around.