Why Auto Insurance Rates Keep Rising


Why do my automobile insurance rates keep skyrocketing every time I get a renewal bill in the mail? Hello, my name is Chip Fridrich and I hear that quite often from my customers these days.


Auto insurance premiums are on the rise. In fact, since 2011, premiums have increased by 20%. It is a growing trend and there’s no end in sight for the foreseeable future.


Claims costs are going through the roof for several reasons. If you watch daytime television, I am certain you have noticed the numerous commercials that have flooded the market from legal specialists wanting to represent individuals when various accidents occur. These litigation costs in many instances cause a claim to exceed what it would otherwise be. The cost to repair or replace a car have also increased rapidly. Cars are lighter and more aerodynamic. There are fancy electronics like sensors, cameras, on board computers, and halogen headlights. These items can add to claim costs and therefore push premiums higher.


Credit scoring is another factor. Credit scoring is here to stay for personal insurance. Statistics show that those with better credit scores are less likely to be involved in accidents than those who have inferior scores. Keep tabs on your score and monitor any changes. If your credit score takes a dive, your insurance premiums could definitely go in the opposite direction. A recent study showed that an insured’s credit score could make for a forty –four percent swing in their premiums.


Finally, distracted driving has become a major issue in our country – not just for teens but adults as well. As a society we must come to grips with this problem. As parents we must establish that texting or using mobile devices while driving is not acceptable. These claims are often deadly, and the numbers of these claims are pushing costs up dramatically. If you are in a state where the use of handheld devices has been outlawed, you need to be careful on the violation front. Some insurance carriers have increased auto premiums by as much as forty five percent for a single distracted driving violation.


If you are concerned about your rising auto insurance rates, contact my office for a no obligation consultation to see if we can provide you an option for superior coverage compared to your current plan while possibly saving you premium dollars as well on all of your personal insurance including home, valuable articles, and excess liability.


Check out our web site at fpa.insure or contact us at info@fpa.insure for more information on how we can be of service to you.



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