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How High Can Premiums Go?

Our car insurance rates fluctuate throughout our lifetime. Factors like age, gender and marital status as well as the make, model and year of our vehicle determine our monthly insurance premium. But it’s our driving habits that ultimately determine how high or low our rates go. While insurance companies do reference statistics to set a baseline, our own driving excellence or indiscretions ultimately determines our rates. If you think you’re a good driver and deserve a better rate, get your comparison auto insurance quotes at CoverHound.

Reasons Why Your Insurance Rates Are Climbing

You have been a loyal client to your insurance agency going on five years now, and feel that you’ve earned a discount. Your insurance company doesn’t see it that way. If you’ve been in an accident or gotten a few speeding tickets, your agency doesn’t view you as an altogether great driver. Driving infractions and violations tell your company that you are an at-risk driver. This means that you are more likely to get into an auto accident and file a claim. Also known as your insurance score, if the insurance company believes you are filing claims too frequently, they will charge you more for their services; this helps ensure that they are not losing money insuring you. Here are some more reasons why your premium is high:

Government Regulations: Car insurance is required by state law. Every state sets their own insurance minimums and limits. Different coverage types are available at different costs. Coverage types include:

Auto liability insurance is the most cost-effective policy as well as being the policy a majority of states require their motorists carry. Other states require their constituents carry comprehensive coverage. Though a more expensive policy, the comprehensive insurance plan offers the most coverage. Because the state regulates insurance coverage laws, your cost is directly affected by said laws.

Having a DUI on Your Record: In our research, we’ve found that motorists with a DUI on their record face an insurance premium hike by as much as 94 percent. Driving under the influence doesn’t just put you at risk, it puts others at risk, too. According to the Centers for Disease Control and Prevention (CDC), 9,967 people were killed in a drunk driving-related accident in 2014, accounting for one-third of all vehicle-related accidents. In a DUI-related accident, insurers are responsible for paying for property damage, bodily injury, medical costs and funerary expenses for all involved parties, depending on the insured’s coverage. Mothers Against Drunk Driving (MADD) found that the average American pays $500 per year because of DUI-related accidents, with drunk driving costing the U.S. $132 billion ever year. To make up for these costs, insurance companies charge the guilty parties more for insurance. But once you have proven you are a responsible driver again, your insurance agency will lower your premium.

To maintain a lower monthly premium, practice good driving. Avoid driving in poor weather and get a taxi after a night out. To find an insurance company that complements your peace of mind, give CoverHound a try today.

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