Every year auto insurers have to raise their prices and one of the reasons they do this is because of the real economic times we live in. With the loss of jobs and companies filing for bankruptcy, many people are finding it harder than ever to make ends meet. Because the cost of living has gone up so much over the years it is no surprise that drivers have had to increase their premiums as well. If you want to find out why car insurance increase every year then read on.
One of the main reasons why car insurance increase every year is because they give discounts for safe drivers. Even though these drivers have a history of being accident free and having a clean record with no moving violations there are still reasons why they have to increase their rates. If you have a good driving record but have recently had an accident or a traffic violation then you may be considered a very risky driver by the insurance companies.
One of the biggest factors that can drive up the cost of car insurance is how safe a driver you are. The insurance companies like to see that you have minimal accidents and do not get into any kind of accidents that will get you in trouble with the law. The safer you are then the less likely you are to have an accident and the cheaper your insurance will be. So if you want to save money on your car insurance then take a defensive driving course and keep your driving record clean.
Another reason why car insurance increase every year is because they need to protect themselves against people who have more than one vehicle. These days many people have more than one car and this has caused an increase in the number of accidents. People who have more than one car on a policy often will either not let the insurance company know about this or will try to pretend that they are not using the car when in reality they are. When the car insurance company realizes that this is a problem then they raise their prices.
One of the ways that they find out about why car insurance increase every year is by checking with the police. They want to make sure that all of the drivers that they write into the database are safe drivers. If they discover that a certain person has several speeding tickets then they are more likely to raise their rates. Some people even try to game the system and not let the police know about traffic violations. This means that if a company notices a person getting a lot of speeding tickets then they will increase their rate.
It is important that you start asking questions about why car insurance rate increase every year. If you don’t ask questions then you are going to find out that you are paying too much for coverage. When this happens people start to lose their coverage and there are less options available. Be active and curious about how much your policy is going for and you may be surprised to learn that you can save quite a bit of money by taking some steps to make yourself safer.