It is a frustrating experience to discover that the costs associated with your car insurance has increased. This is especially true if you cannot determine the reason why. Perhaps you have a clean driving record. Maybe you have not filed any claims.
It should be understood that insurance rates typically do not increase without a reason. In fact, when it comes to car insurance, it typically always indicates that there is some degree of insurance risk at hand. In this guide, you will be introduced to 3 common reasons why car insurance rates go up.
Address-Related Claims
If you noticed that your car insurance rates went up after you relocated to another area, it could be because of claims associated with that area. Your address represents the area where your car is kept the most.
Insurance companies often base rates on how many claims occur in a particular zip code and exactly what types of claims are most often made within that particular zip code. If the company considers the area you have relocated to a “risk”, it is quite likely that you will pay the price – literally.
Insurance Score
We all have what companies refer to as an “insurance score”. This is tied in directly with your credit score. The common consensus is that those who have a higher credit score are less likely to file a claim with their insurance provider.
An insurance company may use information that is pulled from credit rating bureaus in order to establish YOUR rating as a client. If you have a low credit score, you will be considered a higher risk; therefore, you will be required to pay higher insurance premiums than those that have a higher credit score.
Many states now prohibit insurance companies from using a credit score against a policyholder, but many states still allow this.
Discount Losses
The next reason why an insurance rate may be experienced is that you lost some discounts that you previously received. Perhaps you got a ticket or were in an accident. Maybe you purchased a car that does not have the safety features of the previous vehicle that you had.
Maybe you reached a certain age. Maybe you sold your home and are no longer a homeowner or you packaged insurance coverages and cancelled one. There are many discounts available to the insured. If you lost a discount, you are sure to find that your insurance rates increase.
Conclusion
Despite the fact that we do live in an expensive world and there are numerous reasons why our car insurance rates could increase, it is still possible to find really affordable quotes. We here at Modica Associates can assist you.
We will take your information and research who offers the best quotes for you, the vehicle you drive, and the area where you reside. We encourage you to contact us today to learn more and to obtain the most competitive pricing for your car insurance needs by calling: 718-855-1836