Why Did Your Car Insurance Suddenly Go Up?
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Insurance companies calculate premiums based on insurance risk. That means insurance rates do not increase suddenly without reason. A policy price increase can be due to factors you can or cannot control.
For instance, you may have committed a traffic violation, or maybe you were involved in an auto accident. Changes in your profile, such as your place of residence or age, can also affect your auto insurance cost.
To help you understand why your car insurance is so expensive, MoneyGeek breaks down some common factors that lead to insurance rate revisions.
Table of Contents
Key Takeaways
While car insurance providers can increase rates at renewal, it is not without reason.
Factors affecting car insurance rate increases can include things you can control like driving behavior, credit score and place of residence.
Other reasons why car insurance goes up may be out of your control, like your age, loss of discounts and the number of claims in the area.
Why Did Your Car Insurance Rates Go Up at Renewal?
Finding out that you have to pay higher insurance premiums at renewal can be frustrating. It may help to understand that insurance rates increase for a reason.
There are two types of reasons why car insurance goes up.
Why Car Insurance Rates Go Up
- Your driving behavior
- Where you live
- Drivers on your policy
- The vehicle you drive
- You credit score
- A change in marital status
- Accidents and violations in your area
- Claims in your area
- Loss of discounts
- Your age
- Your gender
Any change to your situation may have an impact on your auto insurance rates.
Factors You Can Control
Being a safe driver and maintaining a clean driving record can help you keep your auto insurance rates low. However, it’s important to understand premiums can increase even if you have no claims. Knowing what factors affect your insurance rates can help determine what caused an insurance rate revision.
Driving Behavior
Driving behavior greatly affects your insurance rates. For instance, drivers with tickets, accidents or a DUI on their driving records tend to have higher car insurance rates than drivers with clean records.
Car Insurance Premiums With Tickets and Accidents
Payment Cycle | Rate After Ticket | Rate After An Accident | Rate After DUI |
|---|---|---|---|
Monthly | $153 | $186 | $240 |
6 Months | $918 | $1,119 | $1,440 |
Annual | $1,836 | $2,237 | $2,879 |
Where You Live
Car insurance rates are affected by your residence location. Some states and ZIP codes have more expensive auto insurance policies than others. That means a change in your place of residence can cause a rate revision on your car insurance even if you move to a different city in the same state.
Car Insurance Premiums Based on Where You Live
State | Average Annual Insurance Cost |
|---|---|
AK | $984 |
AL | $1,221 |
AR | $1,189 |
AZ | $1,284 |
CA | $1,429 |
CO | $1,450 |
CT | $1,442 |
DC | $1,202 |
DE | $1,483 |
FL | $2,208 |
GA | $1,638 |
HI | $1,066 |
IA | $778 |
ID | $745 |
IL | $1,134 |
IN | $725 |
KS | $931 |
KY | $1,405 |
LA | $3,041 |
MA | $1,112 |
MD | $2,127 |
ME | $607 |
MI | $4,333 |
MN | $1,199 |
MO | $1,305 |
MS | $1,112 |
MT | $1,216 |
NC | $841 |
ND | $743 |
NE | $923 |
NH | $778 |
NJ | $1,674 |
NM | $1,133 |
NV | $1,900 |
NY | $3,433 |
OH | $803 |
OK | $1,299 |
OR | $1,181 |
PA | $1,818 |
RI | $1,822 |
SC | $1,139 |
SD | $817 |
TN | $1,018 |
TX | $1,316 |
UT | $1,154 |
VA | $790 |
VT | $812 |
WA | $1,264 |
WI | $933 |
WV | $1,016 |
WY | $851 |
Drivers on Your Policy
Adding a driver to your auto insurance policy can either increase or decrease your annual premiums. For example, having a teenager on your policy can increase your insurance premiums. That is because insurance providers consider teens to be riskier drivers due to inexperience behind the wheel.
Use MoneyGeek’s auto insurance calculator to estimate your car insurance costs if you add another person to your policy.
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Vehicle You Drive
Auto insurance companies also consider the type of vehicle you drive. The make and build of your car can change your premiums. Adding or changing to a new car can also increase your insurance rate because certain models, such as those with rare parts, are more expensive to insure.
Car Insurance Based on the Car You Drive
Car Model | Average Annual Premium |
|---|---|
Jeep Patriot | $1,085 |
Honda CR-V | $1,099 |
Subaru Outback | $1,121 |
Audi R8 | $2,770 |
BMW i8 | $2,810 |
Tesla Model Y | $2,878 |
Credit Score
A change in your credit score can mean a change in car insurance rates. If your credit score drops, your insurer may drive up the cost of your policy. That said, there are states — such as California, Hawaii and Massachusetts — where credit score does not matter.
Car Insurance Based on Your Credit Score
State | Excellent | Fair | Poor |
|---|---|---|---|
AK | $860 | $1,108 | $1,412 |
AL | $973 | $1,464 | $2,138 |
AR | $958 | $1,488 | $2,144 |
AZ | $988 | $1,545 | $2,495 |
CO | $1,211 | $1,781 | $2,515 |
CT | $1,221 | $1,782 | $2,511 |
DC | $1,011 | $1,428 | $2,107 |
DE | $1,269 | $1,989 | $2,959 |
FL | $1,644 | $2,648 | $4,194 |
GA | $1,464 | $2,090 | $2,955 |
IA | $620 | $885 | $1,237 |
ID | $608 | $886 | $1,245 |
IL | $985 | $1,430 | $2,077 |
IN | $576 | $856 | $1,220 |
KS | $725 | $1,085 | $1,602 |
KY | $1,187 | $1,862 | $3,023 |
LA | $2,689 | $4,417 | $6,874 |
MD | $1,868 | $2,893 | $3,826 |
ME | $511 | $712 | $1,046 |
MI | $3,361 | $5,920 | $12,574 |
MN | $1,143 | $1,674 | $2,778 |
MO | $936 | $1,493 | $2,270 |
MS | $906 | $1,310 | $1,867 |
MT | $941 | $1,399 | $2,070 |
NC | $721 | $875 | $1,024 |
ND | $604 | $923 | $1,360 |
NE | $661 | $1,002 | $1,442 |
NH | $641 | $904 | $1,274 |
NJ | $1,312 | $2,151 | $3,413 |
NM | $1,019 | $1,438 | $2,115 |
NV | $1,669 | $2,394 | $3,430 |
NY | $3,927 | $6,307 | $10,640 |
OH | $595 | $873 | $1,283 |
OK | $1,064 | $1,515 | $2,146 |
OR | $853 | $1,217 | $1,699 |
PA | $1,250 | $1,912 | $2,871 |
RI | $1,568 | $2,386 | $3,244 |
SC | $898 | $1,342 | $1,858 |
SD | $655 | $912 | $1,243 |
TN | $826 | $1,241 | $1,897 |
TX | $1,023 | $1,596 | $2,344 |
UT | $906 | $1,479 | $2,209 |
VA | $633 | $905 | $1,263 |
VT | $633 | $975 | $1,443 |
WA | $1,057 | $1,495 | $2,073 |
WI | $705 | $1,042 | $1,625 |
WV | $817 | $1,201 | $1,753 |
WY | $713 | $980 | $1,368 |
Factors You Can’t Control
There are instances when the reason why car insurance goes up is out of your hands. An increase is not always because of something you did or did not do. While beyond your control, certain factors may also lead to an insurance rate increase.
Accidents and Violations in Your ZIP Code
Location is significant when determining insurance premiums. Changes to accident and violation rates in your area can affect your rates. That is because insurance considers collective risk. Living in an area with high rates of accidents and violations can increase your chances of being in an accident and lead to more expensive auto insurance rates.
Claims in Your ZIP Code
Car insurance costs may also vary depending on your ZIP code. Even within the same state, auto insurance rates may be more expensive in some areas than in others. For instance, if more people filed claims in your ZIP code, insurers may consider it riskier.
Loss of Discounts
Qualifying for discounts can help you save significantly. However, it is possible to no longer be eligible for the discount at the time of your policy renewal. Check with your insurer if you are still qualified. There may also be other discounts available to you.
Age
Age plays a huge role in car insurance. Based on average rates by age, teenagers and seniors tend to pay more for vehicle insurance than adults in other age groups. This is because of the increased likelihood of getting into an accident at certain ages. Insurance providers consider teens and seniors to be riskier drivers.
Frequently Asked Questions About Why Car Insurance Rates Increase
Knowing the different factors affecting car insurance rates can help you understand why your car insurance rates are so expensive. MoneyGeek answered some frequently asked questions about insurance rate revisions to help you understand auto insurance rates.
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