Despite obeying the rules of the road, driving exceptionally well and not making any claims, you may find that your car insurance has gone up. Perhaps you’re not the best driver and you’ve violated a few road laws so you “deserve” a premium increase. Whatever your specific case may be, when car insurance rates go up, it’s best to know the reason why. Here are a few reasons insurance companies increase your car insurance rates:
- Insurance claims
To prevent loss, insurance companies may raise your rates if you make a claim, especially if you were in an accident that was your fault. This is because you may be seen as a higher risk to the company than they originally thought you were. Basically, the higher your risk profile is, the higher your car insurance will be.
- Life changes
Life changes, such as moving or changing jobs may affect your premiums. This is because your living situation, distance from work etc. is usually taken into account when you apply for insurance. Whatever you do, do not hide information from your insurance company as they have the right to terminate your policy if you do not disclose necessary information.
- Added person to a policy
Once a person is added to your policy, your risk profile increases. Once your risk profile increases, your insurance company will reassess your policy and your premiums will probably increase.
- You’re getting older
Older drivers are seen as higher risks than younger drivers, mainly because younger drivers can supposedly see and respond better when driving.
- Annual fee increases
Increases in annual insurance fees are common. Usually, your insurance company will notify you of any increases ahead of time.
- Wrong insurance company
If your fees are increases too much, you may be with the wrong insurance company. Your car loses its value the moment you drive it out of the showroom, and the value continues to plummet. So, if your car keeps decreasing in value, shouldn’t your insurance premiums decrease too? Well, there is comprehensive car cover that decreases monthly, just like the value of your car. Find out more about car insurance that decreases monthly.