Why Auto Insurance Premiums Increase

For an insured driver, few things are as frustrating as opening a monthly statement and finding a car insurance premium that's suddenly much more expensive.

Car insurance premiums can move up or down for a few different reasons. The most common reason for a rate hike is points on the driving record of someone on the policy -- in other words, traffic tickets. However, traffic tickets are not the only reason rates can change. A lot of other things can play havoc with your car insurance premium, and some of them are totally beyond your control. The good news is, with free online car insurance quotes, you're able to quickly and easily see what other options are out there.

When your insurance premiums increase, it's the perfect time to look for new car insurance quotes. It takes only a few minutes to get multiple car insurance quotes online. Even if you don't decide to switch auto insurance, you will at least know what options are available.

If your car insurance rates have increased and you don't know why, call your insurance company. They should be able to explain exactly why the rates have changed. And, if you're armed with a few good car insurance quotes from their competitors, you might convince your current insurance agent to offer you a better deal on your current policy.

A few of the common reasons for increases in car insurance premiums are:

1. Points on your driving record. Every state has a point system for its licensed drivers. If you're ticketed for certain moving violations, points may be applied to your driving record. However, this doesn't mean there will be an immediate impact on your car insurance costs. Some insurance companies may only check driving records once or twice per year, while in other cases the incident may be proactively reported to the insurance company by the state. The bottom line here is this month's insurance premium hike may actually be the result of last year's speeding ticket.

2. Points on the driving record for another person on the policy. Are you sure that your spouse, your children, or others on your insurance policy didn't get a traffic ticket?

3. Changes in the insurance company's assessment of your zip code's safety. Part of car insurance cost is based on the insurance company's rating overall safety level of the area where the car is registered. This can change, positively or negatively, based on a number of statistical crime factors.

4. Changes in market conditions or company finances. Sometimes, insurance companies increase rates in order to stay competitive, or in response to financial conditions. When this happens, it's the ideal time to shop around, because finding a lower rate could be quick and easy in this scenario.