Four Issues That Can Improve Your Automotive Insurance Charges – The Motley Idiot
Drivers who have car insurance they are happy with will be surprised to find that their tariffs are not necessarily lifelong. In fact, there are many things motorists could do that can skyrocket their premiums.
Policyholders who want to ensure that their insurance coverage does not get much more expensive should be aware that any of these four measures can lead to an increase in the rates.
1. Get a parking ticket
Motor insurance companies estimate the amount of the premium based on the risk of a driver. If an insurer believes that a motorist is more likely to have an accident, the premiums will be higher.
When a driver receives a ticket for a traffic violation such as speeding or running over a red light, it shows the insurance company that the motorist has a tendency to behave at high risk behind the wheel.
Whatever injury the driver committed that led to the ticket could likely also increase the risk of a collision. The insurers will take this into account and increase the coverage costs in the future.
2. Cause a traffic accident
If a driver is responsible for a traffic accident, this is a big warning signal for insurers as well. In addition to paying for the accident, the company must also suspect that the driver who caused the accident is not driving safely and is at greater risk of causing another collision in the future.
Unfortunately, the worse the accident and the more damage it does, the more likely it is that car insurance premiums will be higher in the future. Some insurers also offer discounts for safe driving that could be affected by a traffic accident, which can make premiums soar.
In some cases it is possible for insurers to offer accident forgiveness so they may not increase premiums after certain collisions. However, drivers are usually limited to forgiving an accident. And switching to another insurer could become more expensive after a collision, even if there is an accident forgiveness under the existing insurance coverage, so drivers could get stuck with their current carrier.
3. Moving to a more dangerous neighborhood
Moving to an area where more accidents happen can lead to a higher risk of collision and thus increase car insurance premiums. Plus, insurers don't just cover collisions. When you take out fully comprehensive insurance, the insurance also pays if a vehicle is stolen or damaged by vandals. As a result, moving to a more dangerous environment where other problems might arise will also increase insurance premiums.
4. Buy a more expensive car
More expensive cars can be more expensive to repair or replace in the event of a collision. There may also be an increased risk of the vehicle being stolen. And if a more expensive car is taken, the insurer would of course have to pay more to the policyholder, as the vehicle has a higher market value.
Therefore, if a driver buys a car that costs more than their previous car, it is likely to lead to an increase in insurance premiums as well.
Motorists should be careful to avoid accidents and tickets, and be aware of how moving or buying a new car might affect their rewards so they can anticipate the impact on their budget.