I’m An Excellent Driver – So Why Did My Car Insurance Rate Go Up?

It’s a question asked by many drivers: “I’m an excellent driver – so why did my car insurance rate go up?” It’s a frequent complaint throughout the auto insurance industry. In many cases, it has absolutely nothing to do with anything you may have done wrong behind the wheel. It’s just the way the industry operates.

You’re in a comfort zone, just riding along with no accidents and a spotlessly clean driving record and, wham! – you’re blind-sided by your auto insurance company with higher premiums. What’s up with that? Your rate’s been the same for several years and all you’ve done was move a few miles across town and get a couple of years older.

Well, unfortunately, you pretty much just answered your own question. Fact is, all kinds of factors are used by the insurance industry that can affect your rate over time. While you may not have realized it at the time, when you moved to another residence and got a little older, you changed your premiums and set the new rate in motion.

Some of the factors that may affect your rates are:

  • Purchasing a new vehicle (the more expensive or exotic, the more to insure)
  • Moving to a new location (a higher risk area)
  • Changes in your commute (more driving miles means higher premiums)
  • Changes in your credit score (a drop in your score can mean a rise in your rate)
  • Adding a new or inexperienced driver (teen driver)
  • Causing an accident (self-explanatory)
  • Getting a traffic citation (speeding and other moving violations)
  • Reporting too many claims in a short period of time (even if not your fault)

Inflation can also lead to higher costs. As cars become more expensive and medical, property damage reimbursements, and other industry expenses increase…unfortunately, so will your annual premiums as insurance companies work different ways to absorb their losses.

Another factor that can affect your insurance rates is one that has plagued the industry for a long time – fraudulent claims. Over-inflating damages and filing false claims not only cost the industry billions of dollars each year…it’s a serious problem that can contribute to driving up your rates as well. However, insurance companies are doing their best in trying to identify and prevent insurance fraud.

When fraud scams become predominant in certain cities or when areas of the country turn into hotbeds for fraudsters, insurance companies react, which typically can mean raising rates for customers who live or move to these areas. It’s a domino effect that no one would rather be caught in, but it’s all part of the insurance world.

Truth is…because there are so many different variables and ways your premiums can go up from year to year; it’s safe to assume they’ll continue to fluctuate over time. And, it’s important to know – whatever happens to our insurance rates, it’s not necessarily anything we’ve done wrong that makes them go up. Just keep driving safely and maintain a clean driving record. In the long run, it will still keep the increases to a minimum.

Fluctuations aside, you always want to make sure you’re getting the best rate on your auto insurance. Why not get a free auto insurance quote today?