These errors could make your car insurance prices soar The Motley Idiot
There are certain mistakes that motorists must avoid if they want their auto insurance costs to remain reasonable. In particular, there are three mistakes that can significantly increase the amount a motorist may have to pay for auto insurance.
Here is what they are.
1. Let a policy lapse
Motorists are expected to have car insurance at all times. When a motorist fails to maintain the necessary coverage because they fail to pay their premiums or cancel the insurance before signing up with a new carrier, it becomes a major problem.
Without insurance, there is a risk that in the event of a collision, theft or other damage, the driver will have to pay out of pocket for all damage. The driver also faces legal consequences. Because of the huge risks involved in getting out of insurance, most responsible drivers simply won't.
This means that auto insurers rate customers who have expired their policies as risky. When a motorist receives quotes for insurance coverage, they are asked who their insurer is and whether they have ever had a coverage gap. If so, they can expect much higher premiums than if they had followed the rules and been insured all along.
2. Get a moving infraction
Insurers charge more if they think a crash is more likely. Obviously, a driver who breaks the traffic rules is at greater risk of being involved in a car accident because he does not follow safe driving practices.
For this reason, a traffic violation, such as a parking ticket or driving over a red light, can result in a driver being confronted with higher premiums. Insurers review a policyholder's driving records and also ask about previous relocation violations when someone tries to get insurance. Any motorist with even a single movement violation can expect to pay a higher price for coverage.
3. Buying a high risk vehicle
After all, some vehicles are considered riskier to insure than others. Insurers collect data on claims for different vehicles and know which vehicles are more likely to be involved in accidents or which are more likely to be stolen. They also know which cars lack the safety features that prevent serious injury in the event of an accident, as opposed to cars with airbags and other advanced safety tools that reduce the chance of costly damage.
If a motorist does not know the cheapest cars to insure and instead buys a car that the insurer sees as a risk, it leads to an increase in auto insurance premiums. Motorists can reduce the likelihood that a new car purchase will drive insurance premiums up by getting car insurance quotes from insurers on how much it would cost to insure a particular vehicle before buying it.
Fortunately, any of these mistakes are easily preventable as long as drivers know that they can have serious financial consequences. Motorists can make sure they drive safely, keep their insurance coverage from expiring, and choose a car that won't let their premiums soar.