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When Can A Car Insurance Company Increase Your Premiums?

Nobody likes to find out that their auto insurance company is increasing their premiums, but there are many reasons why this might happen. The cost of your auto insurance ultimately depends on how great of a liability you are to your insurance provider. Each insurance company takes a different approach to calculating monthly premiums, and there are dozens of factors that go into the equation.

Let’s examine a few of the most common reasons why your car insurance company might increase your rates:

1. You Were Involved In An Accident

Just because you were involved in a collision doesn’t necessarily mean that your car insurance premiums will increase. Some providers have accident forgiveness insurance programs, which means being involved in one accident may have little to no effect on your monthly premiums.

In most cases, though, you can expect your insurance rates to hike after a collision. This is especially true if you are deemed at fault for the crash, but even if another driver caused your collision, you may still notice an uptick in your premiums. This is because insurance companies incur costs for every claim filed, and multiple drivers often share blame for collisions even if one driver was determined to be at fault. However, if you live in California or Oklahoma, your insurance company cannot increase your rates after a collision unless you were found to be at fault.

If your insurance rates increased after a crash, you may be able to reduce your premiums by switching to a provider with an accident forgiveness program.


When Can A Car Insurance Company Increase Your Premiums

Your car insurance rates may increase after an accident even if the other driver was found to be at fault.

2. You Were Convicted Of DUI Or DWI

Alcohol contributes to nearly one-third of all fatal accidents in the United States. As such, if you are convicted of DUI or DWI, your insurance company will view you as a greater liability, which translates into higher insurance premiums.

3. You Were Cited For A Traffic Infraction

If you were cited for speeding, reckless driving, or another traffic violation, you can expect an increase in your insurance premiums. Again, this is because your insurance company will see you as a greater liability since traffic laws are designed to prevent collisions.

4. You Purchased A New Vehicle

Some vehicles have higher rates of theft and collisions than others. As such, auto insurance companies charge different premiums for vehicles of different makes and models. Vehicles with higher horsepower also tend to cost more to insure.

5. Inflation

Inflation affects just about every purchase you make, and car insurance is no exception. Even if you were not involved in any collisions or cited for any major traffic violations, you may still notice an uptick in your premiums due to inflation.

6. You Decided To Upgrade Your Insurance Coverage

If you’ve decided to add uninsured motorist coverage, collision coverage, comprehensive coverage, or Personal Injury Protection insurance, or if you increased your liability limits, you can expect your premiums to be higher.

7. You Relocated To A New Residence

Car insurance rates can vary greatly by location. If you move to an area where accidents and claims tend to occur at a higher rate, you can expect to see an increase in your monthly car insurance premiums.

How To Reduce Your Car Insurance Payments

Now that you know when your auto insurance company can increase your premiums, you can make a plan to keep your rates low. Besides getting quotes from multiple providers, you may be able to reduce your insurance payments by following these tips:

  • Limit the number of annual miles you travel to reduce your risk of crashing;
  • Drive safely to avoid accidents and traffic citations;
  • Never drive under the influence of alcohol or drugs; and
  • Purchase a vehicle that is cheaper to insure.

Even if these tips only save you a few dollars on your monthly car insurance premiums, the long term savings could add up to a small fortune.