Why Are My Car Insurance Rates Going Up?

March 21, 2017

New car sales are at a record high and so are car accidents. A substantial increase of car accidents, like we have had the last two years, can raise everyone’s car insurance rates.

But¬†you haven’t had any accidents?

If you haven’t had any accidents or violations, your rate is still most likely going up with all the increased claims this past year. But it isn’t going up as much as the drivers that have had accidents.

Another reason why car insurance rates are generally going up is because of the increase in repair cost. Since more and more people are buying new cars, this is putting more valuable vehicles on the road. Headlights are the most common part that needs repair after an accident. The cost to replace these headlights have drastically increased as shown below.

These new cars also have more parts and more expensive parts due to the advances in technology. For example, a 2015 Honda Accord LX has 23 parts in the front bumper, compared to 13 parts in the 1996 model.

Sensors have also raised the cost for a repair. We were recently told at an insurance seminar that a new bumper on a 2016 Acura now cost roughly $4000 to repair compared to a $1000 repair three years ago.

One way to combat the rate increase is to sign up for these new devices that monitor your driving. Most companies have or are working on devices or apps for your phone, to help you prove that you are a safe driver. Some of these programs are lowering rates by 20%.