Why Do My Insurance Rates Go Up?

Insurance Rates Go Up

As an agent for over thirty years, I’ve had this question asked many times.  Sometimes people ask me because they haven’t made any claims or received any tickets.  They’ve been good as gold and bam…here comes their renewal with higher rates.  The clients say things like, “My car is getting older…shouldn’t the rate go down?”, or “I’ve been with my company lots of years…shouldn’t my rate go down?”  Both are valid points.  So, why in spite of these points do our rates go up?  Let’s look closer.

1.  More cars on the road.  The U.S. has more than 254 million.

2.  More accidents.  The U.S. has more than 6.2 million crashes per year.

3.  Smart cars lead to more expense with mechanical repairs…a 2.7% increase in cost.

4.  The average claim payout has increased by 32% to more than $15,500 per bodily injury    claim.

5.  74% of drivers use Facebook while operating their vehicle.

6.  36% or more of all drivers text and drive leading to distracted driving habits.

7.  16% of all fatal claims are from distracted drivers.

8.  431,000 people are injured from distracted drivers.

Because of the increase in claim payouts, insurance companies have no choice as far as raising prices.  We can all do our part in practicing safe driving habits, and we can exclude using social media and text during our car rides.  Also, I advise having our agency shop your insurance every three years to make sure your rate is competitive.  I’ve found people who move their insurance too often tend to have higher rates because insurance carriers look for longevity in a customer.  Lastly, call us for advise.  After all, that’s what you’re paying us to do.


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