Q: Why is my car insurance so expensive? My rates seem much higher than most people my age, even people who are with the same insurance company.
A: There are several reasons that may cause an individuals car insurance rates to be high. It is important to remember that car insurance rates are variable, and unique to each individual and their specific circumstances. For example, two individuals of the same age, who have a policy with the same car insurance provider, are not guaranteed to receive the same insurance rate. Factors such as an individual’s car make and model, driving record/history, credit history, geographical location, and how much they drive are all taken into consideration when determining an auto insurance rate.
If you feel as if your car insurance rate is high, or becoming more expensive, here are a few common reasons that may cause a car insurance rate to increase.
1. Traffic Tickets or Traffic Offenses.
An individual’s driving record is arguably the most important factor to receiving and maintaining low car insurance rates. Most insurance providers will conduct ongoing audits on new and existing customers looking for recent traffic violations. If you have received a traffic violation (such as a speeding ticket) and it is discovered by your insurance provider, your car insurance rates could likely increase.
2. Auto Insurance Lapse.
If you have let an auto insurance policy lapse, typically for 30 days or longer, you may receive a higher car insurance rate the next time you try applying for car insurance.
3. Buying a New Car
The make and model of your vehicle is a factor in determining your car insurance rate. If you have purchased a new vehicle that your insurance provider determines is “riskier” than your previous vehicle, you may see an increase in your car insurance rate. It is always a good idea to find out how a new vehicle will impact your insurance premiums before you buy it.
Believe it or not, your geographical location will impact your car insurance rate. Providers will assess risk based upon the zip code you live and drive in, however factors such as if the location is a city or rural may also factor in. If you have recently moved to a more populated area, or an area with a higher number of uninsured motorists, you may notice an increase in your car insurance rates.
Khole is the lead insurance advisor and content editor for InsuranceKno.com. She has over 8 years experience in the insurance industry, with a strong focus on property and casualty, health, and life insurance lines.