Many policyholders get the surprise of an increase in car insurance premium by ten or even twenty percent, and that also when they complete a year without any accident or ticket! Normally, the premium should come down with every passing year, but still there are circumstances in which premium quotes increases at renewal.
One of the unnoticed changes in circumstances that affect rates is credit score. There is a probability that the carrier checks the credit rating and increases the automobile insurance premium. Your low credit score may lead to an increased premium overnight. You must be thinking that this is totally unfair, but quite a few states allow it. If your rating is bad, then best alternative is to look for another company that does not check the credit rating while offering quotes.
Some companies keep on increasing their charges by a certain percentage which is so minimal that you do not even bother, but time comes when the premium is much higher and your car is older. This is actually a bad news, but good news is that you can easily shift the company and get insurance at much lower rates. In fact, you can even pressurize your current insurance company to reduce the rates by showing the quotes offered to you by other companies.
Your residence address also matters. Suppose you are moving from a small clean town to a big city. Your company will surely increase the premium as there is a high chance that you may get involved in an accident or get more tickets. But opposite happens if you relocate from a big city to a small town. Make sure that you contact your insurance company when relocating from one place to another.
Your vehicle model also determines the premium rate. If you insure a vehicle with numerous safety features, you will get a much lower quote as compared to the one with less safety features and the one which is more powerful.
Another good reason can be that the insurer found out about the traffic tickets received. Not everybody tells their insurer when they receive penalties. Those will affect rates depending on how severe they are, existence of other citation before and experience of drivers.
Perhaps, you have informed the insurer during the policy period and asking yourself why they did not ask for more money then. Some companies may deem small amounts of increased premium negligible to ask extra payment. This would be the case especially when you have only few months left on your policy. However, the premium will be increased accordingly at the time of renewal.
Sometimes company increases overall premiums of all customers, but this increase is not very high. This is mainly to cover the rising costs. It is so minimal that some customers do not even notice this rise. Actually the companies have to do it to remain in the business.
If you still have a doubt about the rate hike, it is the best to check with your insurer. May be you are paying for an increase in the car crime rates in your city. Before deciding the course of action, you have to check if the reason provided is acceptable or not. After all, it is your right to ask and you should not easily accept this rate hike especially when you have completed another year without any accident or ticket.
Sometimes insurance agents give you a reason that signifies a wrong decision made by the company last year. There is no point paying for company’s faults. In this case, just look around and you will find many insurers that are ready to offer you very low rates especially if you have a clean record. Search on the internet and look for a reputable comparison website that can provide you decent car insurance quotes with the best companies. This makes it really easy to make up your mind and take a final decision.