7 Brutal Reasons Your Car Insurance Just Got More Expensive (Don't Blame Inflation!) – Yahoo Finance


Does that renewal bill for your insurance look a little higher this time around? You’re not alone. Every year drivers across the U.S. experience increased insurance premiums — sometimes for blatantly obvious reasons (such as a speeding ticket) and sometimes for seemingly no reason at all.
Fortunately, there is indeed a method to the madness behind car insurance costs. We’re going to talk about how car insurance works, and the reasons the cost of your auto policy might suddenly go up.
So whether your renewal notice only went up by a couple bucks or suddenly seems to be outlandishly high, these are eight of the most common reasons you might be seeing that increase — and what you can do to lower your car insurance.
There are a lot of reasons your car insurance might increase from year to year. Because auto insurance companies use a wide variety of information to assess risk, your payments can go up even if your driving record remains pristine. Here are eight of the more common (but also sometimes unexpected) reasons you may be seeing your car insurance go up.
23 Legit Ways to Make Extra Cash

It might sound strange, but moving is a common reason to see a rate increase. Because insurance companies tend to calculate premiums based on zip code, you might end up paying more (or less) after making a big move.
Rates for zip codes are calculated based on risk. The risk being assessed is primarily that of an accident or vandalism, which is why people in big cities typically pay more for car insurance than drivers in the suburbs.
If moving changed your proximity to work, this could also be a reason for the premium increase. Driving longer commute distances is seen as a higher risk by insurance companies, and they’ll raise your premiums to cover that risk.
But moving isn’t just a risk factor in the sense of more traffic or exposure to potential break-ins. It can also simply be a matter of the local laws and road quality of your new neighborhood.
For example the state of Louisiana has consistently ranked as one of the most expensive states for car insurance. Far from being an overly dangerous place to live, this state is known for its poor road conditions and surplus of lawsuits. All of this translates into insurance agencies requiring residents to pay more for their auto insurance policies.
Credit scores matter in some unexpected ways. They aren’t just used by big banks to determine your eligibility for a loan; they’re also used by auto insurance companies to predict the likelihood of you filing a claim. And although you’ve probably heard that some insurance companies “don’t look at your credit score,” they do — they just call it something else.
By analyzing select information from your credit reports, insurance companies assess what’s called your credit-based insurance score. The reasoning? Research has shown that people with higher credit scores are less likely to get in accidents or file insurance claims than people with lower credit scores.
Regardless of what it’s called, auto insurance companies are looking at your credit score, and if it drops you might end up paying more for what your car insurance covers. On the flip side, if you improve your credit score you could also improve your auto insurance rate.
Noticed higher speed limits on your local commute? That might be another reason for the increase in your car insurance costs. When states increase their speed limits, it can unfortunately be linked to more accidents on the road.
If you live in a place that recently raised its speed limits, you should expect to pay more for auto coverage on your next policy renewal.
While not enough time has passed for it to be clear if the legalization of marijuana actually results in more car accidents, a study on some of the first states to legalize has shown a possible correlation.
The bottom line? This could easily lead to higher insurance costs for drivers in places where marijuana has been legalized. If you live in (or recently moved to) a state with legal cannabis use, you might end up paying more for car insurance.
Car insurance premiums can go up for a whole slew of reasons, not only if your state legalizes cannabis or decides to increase speed limits.
Other environmental risk factors that can cause your insurance company to charge more include things like an increase in the number of uninsured motorists, more extreme weather events, more accidents caused by distracted drivers, or even an increase in local crime rates.
Any number of things or combination of risk factors can lead to insurance companies charging more, especially if these risk factors lead to more claims for them to pay out.
Another unpredictable reason your insurance might go up? When repairs and medical expenses start to cost more. The more insurance companies have to pay to cover property repairs and medical expenses, the more they’ll charge you for the coverage.
If costs have recently gone up in these industries, those expenses will quickly trickle down to your level in the form of higher coverage rates.
Besides all the unexpected reasons car insurance can go up, there’s also the obvious ones — like if you get a speeding ticket, get caught for a traffic violation, or become involved in an accident that’s considered your fault.
A DUI is another fast track way to paying way more for coverage or even losing your insurance coverage all together, as you’d be considered high risk from the insurer’s standpoint. Moving violations, which are defined as any violation of the law committed by a driver while driving, are another reason you might see an increase in your insurance bill.
The best way to avoid seeing these kinds of increases is by keeping a safe driving record. Another good reason to keep your driving record pristine? Over time, being classified as a safe driver could actually become a factor in when your car insurance rate starts to go down.
Saving money on car insurance might sound complicated, but it’s not. Assuming you have a safe driving record, comparison shopping is a great way to get the best car insurance rate. Start your search online and compare multiple car insurance quotes for the same coverage from different providers. This should give you an idea of what you’ll actually need to pay for the coverage you want.
Even if you don’t end up switching insurance providers, you can still save money with your current provider by changing your plan a little. This might mean choosing a higher car insurance deductible or even eliminating types of extra coverage you don’t need, like comprehensive insurance coverage on an older car. If you’re happy with your current provider, give them a call and talk to them about how to save money on car insurance by changing some details in your policy.
Another great way to save a bit on insurance coverage is by bundling different types of insurance coverages with the same provider. If you have other types of insurance, such as renters or homeowners insurance, you can actually save quite a bit of money by buying them all from the same provider.
It’s normal for car insurance to go up, but that doesn’t mean you have to pay for it. Depending on why your rates increased, you might have the option to shop around for insurance quotes on a new policy, either from your existing provider or from a new one.
Familiarizing yourself with these common reasons for insurance increases will allow you to make the best decision and save the most money when it comes to the cost of your car insurance.
More from FinanceBuzz:

6 genius hacks Costco shoppers should know
8 brilliant moves if you make more than $5k/month
5 things you must do before the next recession

This article 7 Brutal Reasons Your Car Insurance Just Got More Expensive (Don’t Blame Inflation!) originally appeared on FinanceBuzz.
Are you prepared for “extraordinary measures”?
The latest update from an industry darling could signal big financial challenges for marijuana companies.
Buy cheap? Even in the stock market, buyers like to find a bargain. Defining a bargain, however, can be tricky. There’s a stigma that gets attached to low stock prices, based on the reality that most stocks don’t fall without a reason. And those reasons are usually rooted in some facet of poor company performance. But not always, and that’s why finding stock bargains can be tricky. There are plenty of low-priced equities out there with sound fundamentals and solid future prospects, and these opt
The Dow Jones Industrial Average (DJINDICES: ^DJI), Nasdaq Composite (NASDAQINDEX: ^IXIC), and S&P 500 (SNPINDEX: ^GSPC) all fell as much as 1% on the day. Below, you'll learn more about what's pulling down solar energy stocks and whether they can rebound in due course. Enphase Energy (NASDAQ: ENPH), which makes microinverters that allow individual solar panels to convert their energy production from direct current to alternating current, saw its stock drop 11% on Thursday.
(Bloomberg) — The Treasury Department is beginning the use of special measures to avoid a US payments default, after the federal debt limit was reached Thursday.Most Read from BloombergMore Young Americans Are Dying, But Not From VaccinesNew Zealand Prime Minister Ardern Announces Shock ResignationTreasury Taps Retirement Funds to Avoid Breaching US Debt LimitBiden Revives Housing Rule That Trump Derided as ‘Abolishing the Suburbs’Usain Bolt Lost $12 Million in Savings to a ScamThe department i
The U.S. hit the $31 trillion debt ceiling. What happens now and 3 ways this can impact your wallet.
The Oracle of Omaha has a hidden $5.9 billion portfolio that's heavily concentrated in a handful of well-known stocks.
Clean tech and green energy sectors are on the cusp of a strong multiyear growth run. That's the opinion of Morgan Stanley's 5-star analyst Stephen Byrd who notes that political will is likely to support the practical benefits of clean and renewable energy to create a favorable environment for ‘clean and green’ tech over the next few years. Outlining his view, Byrd writes: “We believe current valuations do not reflect the long-term robust growth and margin improvement that we see as a result of
The bailout by the Federal Home Loan Bank has critics questioning whether the government-backed enterprise has lost its way.
Piper Sandler analysts are advising Tesla investors to continue "proactively buying" the EV stock.
(Bloomberg) — Alibaba Group Holding Ltd. co-founder Jack Ma is in Hong Kong for a series of meetings with tech and finance executives, sustaining a recent flurry of activity that’s taken him round the world in the span of months.Most Read from BloombergMore Young Americans Are Dying, But Not From VaccinesNew Zealand Prime Minister Ardern Announces Shock ResignationTreasury Taps Retirement Funds to Avoid Breaching US Debt LimitBiden Revives Housing Rule That Trump Derided as ‘Abolishing the Subu
Stocks moving in after hours: Netflix, Nordstrom, Bed Bath & Beyond
(Bloomberg) — Market watchers on Wall Street attribute this week’s stock selloff to the insidious threat of recession. Yet derivatives traders see a less ominous foe: the mass expiration of options on Friday — the biggest January event in a decade.Most Read from BloombergMore Young Americans Are Dying, But Not From VaccinesNew Zealand Prime Minister Ardern Announces Shock ResignationTreasury Taps Retirement Funds to Avoid Breaching US Debt LimitBiden Revives Housing Rule That Trump Derided as ‘
Are the markets heading up or down? Frankly nobody knows, with some experts saying the next leg is down again and others calling for further upside. Finding the solution to this conundrum, one financial prognosticator thinks the markets will do both. Wells Fargo's head of equity strategy Chris Harvey thinks the S&P 500 could reach 4,200 this year, but not before it posts a decline from current levels to around 3,400. That’s a 15% drop, but from there it will swing 20% higher. Harvey’s outlook is
The U.S. Federal Reserve will end its tightening cycle after a 25-basis-point hike at each of its next two policy meetings and then likely hold interest rates steady for at least the rest of the year, according to most economists in a Reuters poll. Fed officials broadly agree the U.S. central bank should slow the pace of tightening to assess the impact of the rate hikes. The Fed raised its benchmark overnight interest rate by 425 basis points last year, with the bulk of the tightening coming in 75- and 50-basis-point moves.
Intel Corp. is slashing hundreds of jobs in Silicon Valley this month, adding to layoffs late last year that were part of previously announced cost-cutting.
The low price Shell plans to pay for Volta apparently has investors concerned about its rivals' valuations.
Smart display will control the smart home, and serve as a rival to those offered by Google and Amazon
The membership-based warehouse club has dominated the American Customer Satisfaction Index's annual retail survey. The retail giant has topped the survey for six straight years scoring an 81 on a scale that goes to 100, leading its top rival Target and Walmart's Sam's Club, which both scored a 78 while Walmart landed at the bottom of the survey with a 71. Keeping customers happy is essentially Costco's business.
The semiconductor chip industry presents investors with a difficult landscape to navigate. A combination of strong headwinds and economic-structural supports are buffeting the industry in contradictory directions, and for at least the near-term the best investment choices aren’t necessarily clear. Take the headwinds first. Some of the strongest revolve around China, the world’s second-largest economy and a major consumer of semiconductor chips. The country was under strict anti-COVID lockdown po


Leave a Reply

Your email address will not be published. Required fields are marked *