If you’ve spent time recently wondering why your car insurance premiums have shot through the roof, at least take some comfort in knowing that you are not on your own. According to professional sources, insurance costs have gone up by as much as 50% in the ten years from 2006 to 2016.
If you’re looking for ways to cut these costs, it can help to find out a little bit about why they’re so high in the first place. Remember, while insurance is a necessary evil, that doesn’t mean that your hands are tied when it comes to bargaining down those prices.
How does Population Rate Impact Car Insurance Costs?
Did you know that higher populations will often drive up insurance costs? This is because with higher populations come more congestion and this often leads to more accidents on the roads.
This is one of the reasons why it is costlier to insure a vehicle in a crowded city, rather than in an isolated rural area. Furthermore, more population areas will also mean high crime rates, therefore higher chances of someone stealing your vehicle. Insurance companies need to take all this into account before they decide on a specific rate.
What Does My Smartphone have to do with it?
These days, more people own smartphones and many people still use their phones while driving, often causing accidents as a result. This behaviour is so common, in fact, that insurance companies need to take it into consideration when offering car insurance quotes to their potential or existing clients.
In order to ensure you are not punished for the misdeeds of others, it might be helpful for you to choose an insurance company that will track your driving and then quote you based on that performance. Many companies now offer small tracking devices that will monitor your speed, breaking abilities and overall driving performance – and if you’re a safe driver, they’ll lower your monthly premiums.
Which States Boast the Highest Car Insurance Costs?
Living in the right area can greatly reduce your car insurance quotes, especially since car insurance in some areas tend to be sky high. In 2019, Michigan, Rhode Island, Louisiana and Florida have all had their insurance rates reach $2,000 and higher.
These sorts of numbers could have anyone rethinking their living situations. If you’re in the mood for a move, you might want to consider car insurance premiums as one of the deciding factors in your decision.
Which States Boasts the Lowest Car Insurance Costs?
Just as some states have gone stark raving mad in terms of the costs of their insurance premiums, others have actually seem a drop in theirs. Maine, North Carolina, Virginia and Iowa all boast premiums that are lower than $1,000, making them more than half of the cost of those previously listed counterparts.
Should I Increase my Deductible?
This is a difficult question to answer because the truth is that it all depends on your financial situation and what you can personally afford. The deductible is the amount that you will need to pay in the event that you make a claim (your insurance company will pay the rest). This amount will differ depending on your choice when you apply for the insurance and it can vary from 0 to hundreds or thousands of dollars.
It is important to note, however, that by raising your deductible, you could end up actually saving a lot of money each month as this lowers your monthly premiums. You need to be in a position to be able to pay the deductible, however, in the event you need to make a claim. This sort of move is best for those who have an emergency fund available to them in the event that the worst should happen – after all, it is a risk you need to be willing (and able) to take.
How Much Coverage do you Need?
There are certain types of car insurance that will cover everything and anything, from injuries to natural disasters, but if you don’t need it, then you might be paying a lot more than you should.
While you might need to be covered in the event you or the other party is injured, you might not need extended coverage (especially if you’re already getting sufficient coverage from your dealer), so take some time to go over your policy with a fine-toothed comb and cut everything you no longer need.
Do you Need to Shop for Insurance Every Year?
Doing all the work when it comes to shopping for car insurance – including comparing rates and bargaining with companies – can take a lot of time and energy but it could end up saving you hundreds of dollars each year.
You need to shop around every single time you renew your auto insurance policy – even if you’re planning on going back to the same insurance company- as a clean driving record can get you really fantastic deals.
Should I Go Through an Agent?
This depends on what sort of agent you are working with. If you’re working with an agent who will look at a wide range of different companies and policies, it might be worthwhile going down this road for the independent advice. On the other hand, if you have an agent who isn’t willing to do this, then you’ll want to steer clear.
Keep in mind that an agent needs to be totally up front about the money they are making from the deal – and where it is coming from – otherwise, they won’t be putting your interests first.