When comparing auto insurance costs, most drivers seek a combination of low premiums with appropriate coverage and excellent customer service. After all, when filing a claim, policyholders don’t want to be left in limbo. We all want insurance rates to go down or stay the same.
It can be frustrating when insurance rates go up. A rate increase is understandable if there was a claim, but what if there was no claim filed? There are several reasons why auto insurance costs go up without a claim. Here are a few to keep in mind.
Changes in the Policyholder’s Information
If you make a change to your auto insurance policy, there may be a premium change. For example, insuring a new vehicle is likely to cost more than an older one. Despite advanced safety features, new cars often cost more to repair.
Adding a driver to the policy can also impact the insurance rate. Additional drivers bring their own driving history and risk, which may increase policy rates.
Furthermore, a speeding ticket can affect policy rates. The ticket shows the possibility of risky driving, which can result in higher insurance rates. As such, the more infractions you have on your record, the riskier you are to insure.
Other, less obvious, personal life factors can also affect policy rates. A change in the policyholder’s credit score, age, or marital status during the term of a policy can affect insurance rates.
Significant Losses Because Other People Filed a Claim
Even if a policyholder did not have a claim, higher-than-usual losses in the local area could also affect policy rates. Everything from an uptick in expensive claims to a significant natural disaster can impact an entire region’s insurance rates.
Hurricanes, tornados, and floods are common causes of rate increases. It is simple to find out if this is the cause of auto insurance costs going up. Contact the Florida Office of Insurance Regulation for information on why an insurance company filed for a rate change.
Inflation and Overall Auto Insurance Cost Increases
Inflation results in cost increases of products and services throughout most of the economy, including insurance.
Plus, as new features and technology make cars more expensive, it also makes repairs more expensive, which can result in higher auto insurance rates. For example, windshield repairs used to run $300-$600, and now, they can be upwards of $3,000.
It is also important to keep in mind that auto insurance pays for some of the medical costs of injured drivers. So as medical costs increase, auto insurance rates typically increase to keep pace with healthcare costs.
How Insurance Companies Increase Rates
Sometimes policyholders think insurance companies can change their rates at will, but this is not the case. There is a specific process for changing insurance rates that varies by state.
Although the rules for changing rates vary from state-to-state, one thing remains the same; the insurance company must file all rate changes with each state. If you have questions about a rate change in Florida, you can ask your agent for information. Plus, you can contact the Office of Insurance Regulation in Tallahassee about rate changes.
The Florida Office of Insurance Regulation reviews and approves all rate changes. If a price increase is filed but not approved, the insurance company must return the difference to its customers.
What Can Be Done About an Increase in Auto Insurance Costs?
It can be frustrating when auto insurance rates rise, but the policyholder did not file a claim. Fortunately, there is something you can do to make sure you are getting the best rate.
Begin with a call to your insurance agent to discuss your coverages and possible discounts that might be available to you. A policyholder may be entitled to a premium decrease due to membership in an association, a defensive driver class, or other safety measures.
Your insurance agent can also help you review coverage levels to make sure they are appropriate for the drivers and type of cars. For instance, an older vehicle may not need collision coverage.
ABC Dennis Insurance
ABC Dennis Insurance is an independent insurance agency established in 1997 that provides auto insurance to its customers. If you have not reviewed your insurance coverages this year, please call our office at (813) 949-7765 or email us.
Besides auto insurance, we can help with all your insurance needs. As an independent agency, we find the best insurance coverage with the most competitive rates.
