If you’ve ever had questions about why your premiums are high, why they increase yearly, or why they don’t decrease even if you’re a perfect driver – this post can help you!
Last week we learned about some insurance habits regarding auto coverage that could wind up costing you more in the long term. This week we want to teach you about things that can negatively affect your insurance premiums, even more than an accident. An accident claim typically increases your insurance premiums by approximately 32% or $459 a year (not including deductibles).
1. Adding a teen driver raises your insurance. (16 yr old female, 125% increase. 16 yr old male, 160% increase.)
a. Data supports that teens are high-risk drivers since they lack experience and take longer to react to certain situations on the road.
b. Insurance rates decrease every year they are ticket and accident free and further once they reach age 25.
2. DUIs (79% increase)
a. Driving under the influence is an infraction that stays on your record ranging from 5 to 10+ years depending on the state. This means that this infraction increases in cost over time rather than dropping from your record after three years.
b. DUIs also severely limit your insurance options as some carriers will not insure someone with a DUI on their record.
3. Reckless driving (73% increase)
a. Reckless driving is considered a “major” violation by insurance companies and can indicate a future reckless driving ticket.
b. These violations include amongst others: driving 25mph over the speed limit, street racing, attempting to escape the police, and passing on a double yellow line with limited visibility.
c. These violations stay on your record for 5 to 7 years!
4. Low Credit affects car insurance! (71% increase)
a. Insurance companies have a correlation with low credit scores and insurance claims, both in amount and cost per claim.
b. Exceptions for this are for people living in California, Hawaii, and Massachusetts where insurers using credit scores when using rates are prohibited.
5. Two speeding tickets (43% increase)
a. Two speeding tickets in a one-year period can noticeably affect your premiums.
b. One ticket can increase your rates from 22-30%, with two increasing it as high as 43% where they will remain for at least 3 years until they fall off your record.
Thank you for learning more about your rates. If you feel like your rates are too high contact ABCO and learn what your options are from 25+ insurance carriers. Next week we'll cover how to lower your insurance.
Drive safe!
