Why Is My Auto Insurance So High?

by Neil Kokemuller
<p>A number of factors, some controllable and some not, contribute to high auto insurance premiums. Getting multiple quotes and working to improve controllable factors are strategies to reduce your rates.</p>

Demographic Factors

<p><a href="http://www.farmers.com/inner-circle/car-safety/why-did-my-car-insurance-rates-change/">Being a young and inexperienced driver</a>, particularly male, is a primary factor that causes high auto insurance, according to Farmers Insurance. Without a driving history, the uncertainty means greater risk for the insurance company, which causes higher rates. There isn't much you can do about your age or lack of experience other than <strong>drive safely and drive more as you get older.</strong></p>

Your Vehicle

<p>The vehicle you select plays a role as well. Vehicles with limited safety features <a href="http://learningcenter.statefarm.com/auto/7-factors-affecting-your-auto-insurance-premiums/">typically cost more</a> to insure than cars with critical safety features. The insurance company's concern is that if your car is relatively unsafe and expensive to fix up or replace after a total loss, you could break the bank. Smaller, <a href="http://www.bankrate.com/finance/insurance/10-most-and-least-expensive-cars-to-insure-1.aspx">sportier cars tend to get into more accidents</a> and therefore cost more to insure, reported Bankrate. While insurance costs may not stop you from buying the Ferrari you want, getting rate quotes before buying that new car prepares you for potentially higher rates. <strong>Attaching a young driver to a vehicle with a high safety rating is a strategy</strong> to avoid the double-whammy of a young person and an expensive car.</p> <p>Particular factors and <a href="http://usnews.rankingsandreviews.com/cars-trucks/Volvo_S60/Safety/">safety features</a> that help minimize insurance costs include:</p> <ul> <li>Good highway crash-test safety ratings</li> <li>Multiple air bags</li> <li>Daytime running lights</li> <li>Traction control and four-wheel anti-lock brakes</li> <li>Blind-spot monitors</li> </ul>

Car Accidents

<p>Getting into an accident is a surefire way to raise your premiums. A January 2015 CBS News article noted that drivers see average rate spikes of 41 percent after a single accident. This fact speaks to the importance of defensive driving. After a few years, accidents are removed from your insurance rating, but good safety habits keep your rates low to begin with.</p>

Missed Opportunities

<p>In some cases, your rates are high because you haven't explored or discovered opportunities to lower them. <strong>One simple approach is to shop around and compare rates.</strong> Providers offer different discounts that may benefit you. As your driving situation changes, the benefits of one company become more or less valuable. <a href="http://www.bankrate.com/finance/insurance/car-insurance-discounts.aspx">Common discounts offered by agencies</a> include multi-vehicle, safe driver, antitheft system, good student and loyalty discounts, according to Bankrate. A good student discount is an excellent way to save some money on a young driver.</p>


Other potential auto insurance discounts include paperless statements, annual payment in full and a green vehicle.

About the Author

Neil Kokemuller has been an active business, finance and education writer and content media website developer since 2007. He has been a college marketing professor since 2004. Kokemuller has additional professional experience in marketing, retail and small business. He holds a Master of Business Administration from Iowa State University.

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