Finding out you're paying more for auto insurance this year than last can be a bit of a shock, especially if you're not sure why they increased in the first place. Fortunately, the following offers an in-depth explanation of what could have given your annual premiums an unwelcome bump in cost.
You Recently Got a Traffic Citation
Getting nabbed by Johnny Law for going 45 in a 35 mph zone could leave you out of more than just a few bucks. Just having a traffic citation on your driving record could tilt the insurance playing field against your favor. A recent study found that drivers who had a speeding ticket or other traffic citation on their driving record faced annual premium increases ranging from $80 to as much as $1,041.
You Were Involved in an At-Fault Accident
Being involved in the accident that was partially or completely your fault can also cause your insurance premiums to skyrocket. According to one study, drivers who made a single claim totaling $2,000 or more in damages saw their average premiums increase by 41 percent. For this very reason, many auto insurance providers offer accident forgiveness, which ensures that your very first accident doesn't have an impact on your rates.
You Recently Moved to a New City or State
Moving from one zip code to another can have a significant impact on your insurance premiums. Important factors such as accident rates, crime rates, average income and parking arrangements can determine whether or not you'll pay more for your coverage each month. If you move closer to downtown and your new place forces you to use street-side parking, those circumstances could lead to a premium increase.
You Purchased Another Car
Buying another car can drastically affect your insurance premiums, based on the type of car and its features. If it's a newer car, you can expect to pay more due to its higher value. If it's a model that's well-known for having a higher rate of accidents than others, you'll likely see your premiums increase. Most sports cars are notorious for having high insurance premiums attached to them, especially if you happen to be under the age of 25.
Your Credit Score Took a Hit
Your driving record isn't the only thing that auto insurers look at when calculating your premiums. In many states, your auto insurance provider can also take a look at your recent credit history. A recent dip in your credit score could cause your premiums to skyrocket, especially if it happens close to your current policy's renewal. Keep in mind that some states, including California, actually prohibit this practice since it often puts low-income drivers at a disadvantage.
Contact a company like Nelson Insurance Agency for more information and assistance.