Why Are Car Insurance Rates Going Up? Auto Insurance Experts Explain

March 7, 2024

There can be many reasons why car insurance is so expensive and still going up, from involvement in accidents to changes in the policy. For a driver, knowing these nuances usually translates into getting the most cost-effective coverage and peace of mind on the road.

Read on to learn why car insurance is going up and whether it’s possible to reduce your policy costs.

How Much Will Auto Insurance Prices Rise This Year?

The average cost of auto insurance is increasing across the United States. According to various estimates, the price of an average policy in 2024 will increase by approximately 10% from last year’s cost.

Line graph with figures showing the steep rise in car insurance premiums

Source: Independent

However, this is a subjective assessment based on variables like the policy itself, the current risk assessment in the region, the type and condition of the car, the driver’s experience, and many more.

Why Is My Car Insurance So High?

As being said, there are quite a few reasons for a higher-than-average insurance premium. For example, if you’ve purchased a retro car,  your insurance rates may be higher than the market average. Likewise, a poor driving history will inevitably result in an increase in your car insurance premium.

Here’s more on the topic:

5 Reasons Why Your Car Insurance Skyrocketed

Expensive VehicleThe rule of thumb is that the more expensive the vehicle, the higher the auto insurance premium. Retro, exclusive, and premium vehicles are costly to repair or replace, so insurers factor this in when calculating premiums.
Old VehicleOne of the less obvious reasons why your car insurance keeps going up is the aging of the car. But it’s a double-edged sword. On the one hand, new vehicles are usually more expensive and may be complex to maintain, which raises insurance prices. On the other hand, older cars may not have replacement parts on the market, making maintenance even more painful.
Number and Age of DriversAnother reason for car insurance to go up is the presence of young or high-risk drivers on the policy.  This factor can be somehow negated if you include the young driver in your policy.
Insurance HistoryThe driver’s accident and violation history, including those that were the fault of a third party, can be a huge price factor. It goes without saying that damaged vehicles are more expensive to insure.
Car Theft RateAn unavoidable reason why car insurance can go up is car theft and accident statistics, especially in Texas, California, Florida, and Michigan.

How To Reduce Car Insurance Costs

It’s not unusual to see divers wondering along these lines: “Why did my car insurance go up without an accident, and how do I reduce its costs?”

To stop your car insurance rates from going up, the least you can do is to practice safe driving: avoid speeding tickets and road accidents and take extra care of your vehicle.

But there’s more to it. If you’re still concerned about why your auto insurance goes up, below are a few tips for you.

Add Experienced Drivers to the Policy

Among the most popular solutions to the notorious “Why did my auto insurance go up” question is to add an experienced driver to your policy. This could be a family member or relative who lives in your region, has access to a car, and was a spotless driver throughout their career.

Keep an Eye on Promotions

When was the last time you visited your provider’s website? The “why car insurance rates are going up” question might no longer be relevant once you’ve leveraged your insurer’s building opportunities, promotions, or loyalty perks.

Update Your Policy Promptly

Another viable approach to the “why my insurance is going up” question is renewing your policy on time and opting for larger packages. For example, you can enroll in a yearly policy instead of a quarterly or semi-annual one.

Likewise, pay attention to the initial insurance conditions. Sometimes, it’s cheaper to renegotiate the deal than to renew it. With this approach, you’ll have every chance to overcome the “why my insurance keeps going up” problem.

Complete Your Profile

Completing a customer profile for an auto insurance company

Source: Powerslides

At the end of the day, the “Why did car insurance go up?” question expresses the driver’s desire to save. And here’s a life hack: complete your profile on the insurer’s website to receive personalized offers that will allow you not to worry about why your car insurance keeps going up. Leveraging tailored bonuses and promotions can help you save a significant amount of money on your insurance.

How To Pay Less for Car Insurance

Popular strategies to decrease auto insurance costs

Source: Investopedia

Here’s how you can stop wondering why your car insurance went up and pay less for car insurance:

  • Keep track of your insurance provider’s policy
  • Renew your policy on time
  • Fill out your profile in as much detail as possible
  • Consider the regional situation
  • Choose optimal tariffs
  • Conduct timely vehicle inspections

If these steps don’t help, there are a few other ways to combat car insurance rates going up.

Don’t ask why car insurance rates go up if you’re driving a rare or concept car, as insurance rates for such cars are significantly higher. In contrast, owners of common cars usually don’t worry about issues like “why car insurance rates went up” because it hardly affects them.

Drive Carefully

To stop worrying about why car insurance rates went up, drive carefully. Don’t exceed speed limits, avoid creating hazardous situations, and avoid getting fined.

Here are more insights on the topic:

Changes in Your Driving Profile Can Increase Rates

Seven major factors that influence auto insurance rates

Source: MarketWatch

Here are the most popular questions among drivers of all categories:

  • Why is my car insurance so high?
  • Why does my car insurance keep going up?
  • Why did my progressive insurance go up?

All these questions, though, may have one root: a change in your driving profile – for example, if you were involved in an accident or violated traffic regulations and received a fine.

Even if you weren’t personally at fault, that’s less important to the insurance company than the damages they’re compensating for. Your risk coefficient is increasing, and car insurance rates are going up.

Will Car Insurance Rates Go Down?

Statistics on the average auto insurance rate

Source: Clovered

Whether you can overcome car insurance rates going up depends on whether you can adjust your approach to dealing with insurance providers. Stop worrying about car insurance increases and focus on improving your insurance score.

Frequently Asked Questions

Why is car insurance so expensive? 

The price of car insurance reflects the average expected expenses of the insurer regarding all insured cars, not just your car. Long story short, car insurance is expensive because recovering damages or car replacement is very expensive, and it’s natural that insurance companies won’t pay for it out of pocket.

Why did my insurance go up, and how can I lower the price?

Follow these recommendations:
– Add no-risk drivers to your policy
– Use your insurer’s promotions
– Renew your policy on time
– Drive carefully
– Work on your driving and insurance profiles.

Why did my car insurance go up when nothing changed?

Here are some factors that may cause car insurance rates to go up:
– Political and economic situation
– Regional road conditions
– Insurance claim statistics
– Legislative changes

Why does my insurance keep going up every year?

The short answer is that your insurance keeps going up because your car ages. Over time, equipment wears out, powertrains and chassis components deteriorate, and every part and element ages, increasing the associated risk.

Victoria Berezhetska

Victoria Berezhetska is a Content Lead at Phonexa.com and an expert contributor to CoverExplore. She has a Bachelor of Science degree in Business Administration, with extensive working experience as a PR specialist and content writer. At CoverExplore, she helps customers find the right educational material through easily digestible blog posts and buying guides backing their insurance coverage choice. Victoria covers diverse topics around digital and insurance marketing, including auto, home, health, and life insurance.

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