Reasons Your Car Insurance Premium Might Increase

When insuring your car, you want to buy the policy that provides you both the most value and the most affordability for your needs. However, the premium quote that your agent gives you initially might not remain the same over the years. In certain cases, your rates will increase with time. 

It is not uncommon to see your car insurance premiums increase. However, the causes of these increases might surprise you. Still, by understanding the triggers of rate increases, you can be prepared to manage them with the help of your agent. 

Some of the causes of a premium hike might be: 

1. You Filed a Claim on Your Plan 
Since all auto insurance premiums are based on risk, then by filing a claim on your policy, you will prove to your insurer that you are a higher risk to cover. As a result, they might have to charge you more. They need to make sure that they can continue to protect cost risk to them in the future. 

2. You Moved 
If you move to a different area, even just a few blocks from your current home, then you need to update your auto policy. Claim risks differ from place to place. So, if you relocate to an area where there are higher accident risks, more drivers or higher risks of vehicle theft, then your premiums might increase. 

3. You Received a Ticket or DUI 
Drivers who violate the law are high risks to insure. Therefore, getting tickets, causing accidents or receiving a DUI could cause your rates to skyrocket. Your insurer will likely review your driving record each time you renew your policy to see if there are any new infractions present. 

4. You Increased Your Coverage 
The laws of supply and demand are simple. If you increase your coverage limits on your plan, then you are likely to pay more for your coverage. 

5. You Decreased Your Deductibles 
Deductibles are costs that you pay towards the cost of a claim before your insurer covers remaining damage costs. Therefore, if you lower your deductible, then you will shift a cost burden onto the insurer. They therefore might increase your premium.  

6. You Bought a New Car 
When you buy a new car, you have a lot more value to insure. Additionally, you will likely have to buy coverage like physical damage and gap insurance. As a result, your premiums will likely go up. Still, any premium increase is far less than the cost that vehicle damage might bring. 

If you are concerned about an increase in your auto insurance premium, then just call your agent to discuss what you can do to help yourself save. We can recommend discounts, policy re-writes and other changes that will help you optimize your savings while still maintaining the value provided  

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