Car insurance premiums can increase for a variety of reasons. The most significant increases can occur after you've been involved in an at fault accident. Some companies such as Allstate will give you accident forgiveness so this does not happen. Other reasons that can cause premiums to go up vary from company/statewide increases due to a higher loss % in your area to diminishing discounts.
Business Development Officer, T.D. McNeil Insurance Services, Fresno, California
Every state insurance commissioner approves the rating structure used by a company operating in its state. Rate structures reflect the company’s ability to pay claims and this is monitored closely. If you experience a rate increase it is either because the rating structure or the rates themselves have changed or because your personal experience has changed. For example you could have reached an age or experience level that would cause the price to lower. You could have been convicted of a violation, or been involved in an accident. Your agent should be able to explain to you specifically why your rate changed.
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Car insurance premiums increase because of increased claims or a perception by the insurer that your risk for having an accident has increased. Of course, the cost of liability, cost of repair to vehicles and value of other vehicles on the road has an impact.
During my 33 years as a car insurance broker (and owner of several of the nation's top car insurance websites), this question is asked quite often!
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During my 33 years as a car insurance broker (and owner of several of the nation's top car insurance websites), this question is asked quite often!