How do you know if you’re paying too much? What makes auto insurance premiums go up? Let’s take a look at some of the factors that affect the price of your car insurance.
You have teenage drivers.
This one is not entirely your fault. But unless you want your children to wait until they are old enough to pay their own insurance policy, you may be stuck with higher car insurance rates. Why, you ask? Simply because teens are less experienced drivers, meaning they are a higher risk driver. (Not to mention all the distractions they now have). If you think your rates increase enough just by adding a teen to your insurance, then you’re going to be in shock if they get in an accident while driving your car.
You’re under 25 or over 60.
Young drivers with less experience are involved in more accidents which makes premiums higher. Once drivers enter their 60s, however, the trend begins to slowly reverse as age and slower reflexes begin to impact driving.
You get tickets.
If you are cited for a moving violation, consider driving a lot slower for a while — your second ticket could trigger a rate increase. Your insurance carrier may disregard the first ticket after a time, typically two years.
You filed an at-fault claim.
As soon as a claim is filed against your insurance, you become a more expensive customer. Expect your rates to go up. However, don’t be afraid to talk to your insurance company after you’re involved in an accident. If you are found to be not at fault, sometimes, your rates won’t be affected. Generally, you should be eligible for a lower rate after a period with no claims.
You make small claims.
Yes your insurance company is there for you to make claims, but they are not there to pay for every small amount of damage that happens to your vehicle. Insurance is meant to save you from huge financial losses. Those with a tendency to file a claim every time something happens, also tend to watch their insurance rates increase over time.
You cancelled an insurance policy or drove uninsured in the past.
If you cancelled an auto insurance policy before it expired, you might pay more to get your next policy. Operating a vehicle without insurance makes you a riskier customer.
Your deductible is low.
The deductible is the amount you have to pay out of pocket before your insurer covers a claim. Having a higher deductible will lower your premium.
Your car is expensive to insure.
Expensive cars and luxury vehicles cost more to insure than inexpensive ones because the cost to repair or replace is higher. Small sports cars are involved in accidents more often than family sedans, so they come with higher premiums.
You have more coverage than you need.
Consider the types of coverage you opt for. When a car is new, full coverage is appropriate. You wouldn’t want to owe money on a car that’s totaled in an accident. If you have a car loan, the lender will probably require full coverage until the loan is paid off. But if you’re driving an older car with a lower value, consider lowering collision coverage.
You haven’t asked about discounts.
Contact your Agent to find out how you might bring your premiums down. Here are some situations that might make you eligible for a discount:
- You’re a full-time student with good grades
- Your vehicle has OnStar, Lo-Jack or another tracking device
- Your vehicle has an anti-theft device
- Multiple vehicles on the same policy
- Multiple policies with the same Company
To keep auto insurance costs low, it helps to keep your record clean, choose your coverage carefully, and avoid claims. Have more questions about how to lower your premium, call us at 586-949-5570, we’re here to help.