Why Does my Auto Insurance Rate Keep Increasing?
One question our clients ask us frequently is, Why has my auto insurance rate increased? It can be frustrating to see a drastic increase, or even a slight increase in your premium, when you have nothing against your driving record and you make your payments on time. What you may not know about are the external factors at work that affect your rate based on the area you live in, as well as the overall behaviors and patterns of the general population as a whole.
The State you Live In: Auto insurance rates have been increasing throughout the entire country over the last few years, especially in Georgia where rates have almost doubled what they are in other states. This dramatic increase is due to the total number of accidents that occur because people are out on the roads more often and they are driving longer distances. This leads to a higher number of personal claims, as well as an increase in the severity of the claims being filed. The overall cost of claims that insurance companies are having to pay out are increasing because of the higher costs of medical care as well as higher costs to repair vehicles damaged in accidents.
Where you live: The area that you reside in can also affect your auto rate. For instance, if you live in a highly populated area, then there is “assumed risk” while you’re driving that an accident is more likely to occur. Your insurance company may raise your rate due to the uncertainty of what might happen to you on the road based on where you are driving, and how many miles you are driving. Since people are driving more and for longer distances, the amount that insurance companies are having to pay out in claims continues to increase throughout the year. Even if you are an excellent driver with no claims, companies raise rates to help cover the cost of claims they are having to cover.
Distracted Driving: Cell phone use and other unsafe practices behind the wheel also contribute to an increase in auto rates because they are responsible for a higher percentage of accidents than in previous years, which leads to more claims filed due to distracted driving. The more that technology advances, the more apps and information drivers have to be distracted by, so a driver’s focus isn’t solely on the road or paying close attention to others around them. Texting and talking on the phone are not the only threats that smartphones pose, using GPS and other apps such as Snapchat, Facebook, and Twitter also divert drivers’ attention.
Technology: It is constantly being improved and updated on cars, and the cost to replace and repair cars has gone up dramatically. Imagine a minor bumper scratch or dent just a few years ago, versus one today where there are cameras and sensors on every angle of a bumper. If those systems are damaged or need to be replaced, it costs a bit more to repair than just the bumper alone. New technology and systems are being integrated daily, and you can bet that even though some of the advances are there to keep you safe, they can also add to the amount of an accident claim in the end.
How We can Help: We at the Dickerson Agency will help you shop and buy the best coverage that will protect your quality of life, should a claim occur. With insurance companies raising rates for auto insurance, we are constantly looking for the best rates that will keep our insured’s adequately covered if they are in an accident. If you have any questions about your rate, or would like a second opinion on your current coverage, please do not hesitate to reach out to one of our amazing agents, and we will be happy to help you!