The reason your car insurance company may ultimately raise your rates is because seatbelts are associated with safety. If you choose to not wear your seatbelt, you are placing yourself at risk unnecessarily. In their eyes, you may be considered a high risk and this may lead to higher premiums.
Failing to buckle up can cost you in other ways too. For example, if you are receiving an additional discount based on safety features, your auto insurance company may review your history and disqualify you for things like safe driver benefits.
Car insurance companies want to insure safe drivers who practice safe driving on a regular basis. This includes people who consistently use seatbelts. Utilizing a seatbelt can provide a sense of security and can also help reduce the number of serious accidents that occur as a result of not using safety restraints.
What causes car insurance companies to raise your rates?
Aside from the usual cost of doing business, which is generally minimal, you may receive an increase in your auto insurance rates if you are involved in any type of motor vehicle violation that adds points to your driver's license. Some insurance companies will start increases after as little as two points are added. The amount of points and type of violations vary. Some common offenses include:
- Speeding
- Reckless driving
- DUI or DWI
Your rates may also be increased if you have too many accidents that result in multiple claims. Each time you have a car accident, you cost your auto insurance provider thousands of dollars, this often results in a higher premium for you so they can try to recoup their losses from the payout.
Depending on the severity of the infraction, your car insurance company may raise your rates anywhere from 10 to 50%. You may also be subject to policy cancellation if your violation is serious and leads to a conviction.
Car insurance companies are well aware of your driving history; this includes your offenses and violations. If your rates are increased because of poor safety habits or other infractions, you will suffer the burden until your record is clean with the Department of Motor Vehicles.
Do auto insurance companies lower their rates? If so, what is it based on?
Car insurance companies may lower their rates in various ways. Receiving a reduction in car insurance premiums is considered a reward for having an excellent driving history. This usually includes zero car accidents or moving violations resulting in points being added to your driver's license. You may also receive a reduction in your annual premium if you utilize safety devices such as:
- Alarms
- Ignition kill switches
- External security mechanisms like steering wheel locks
When you take the time to ensure that your vehicle is protected, your car insurance company may recognize your effort and reward you.
Another way your rates can be affected in a positive manner revolves around the way you pay your premium. Some insurance companies actually offer you a discount if you pay your bill in full rather than in monthly installments. You may also have the option of paying quarterly and still receive a break.
If my car insurance company raises my rates, should I stay or should I look for a new one?
Before you go looking for a new automobile insurance company, think about the benefits you have and if you are willing to trade one or more for something else. Most people have car insurance for years and unless you have a poor experience, you stay with them.
An increase in rates should not be the only reason you seek out a new car insurance agency. First, consider the actual increase and decide if it is justified. Next, review your benefits. Do you use them or are they just part of a package deal? If your needs have changed and you require an updated policy, can your current provider assist you?
Sometimes, it is easier to work with what you have. Maybe your auto insurance company can adjust your current policy to fit your changing lifestyle. Remember, they want to keep you as a customer, especially if you have been with them for a while.
Do not panic just because receive notice that your premiums are increasing. You should have enough time to review your options before you make any decisions. You do not want to sacrifice a long, stable history with a new company unless you know it has your best interest in mind.
