Have you recently had a shock increase in your car insurance premium? We take a look at 6 reasons why it could have suddenly gone up.
It is never pleasant to receive an unexpected increase in your car insurance premium. Not only does it impact your monthly expenditure, but it could have an effect on your loyalty to your insurer.
6 Reasons Why Your Insurance Could Have Gone Up
If you are wondering why your premium has suddenly sky-rocketed, we can help you find the reason.
1. You Have Claimed
Claims highly impact the insurance premiums that you are paying. Should you have been involved in a minor accident, or bumper bashing, your premium could rise. Insurers will constantly analyse your policy in order to ascertain whether your risk, to them, is increasing. In the case of a write-off, whether it be your fault or not, you can expect to pay more for insurance on your new car. The number of claims you make, per year, will also impact your premium. Should the insurer see that you have been involved in numerous incidents, they will heighten your risk profile and the premium will be raised. Also be aware that they could possibly cancel your policy completely should you be over-claiming.
2. Poor Credit Rating
All financial service providers have access to a centralised database of your financial information. If you have recently been blacklisted, or are going through debt review, the insurer could pick this up. They will see this as you posing a higher risk to their company. If you are involved in an accident, you might not be able to afford the excess that you have signed for, if you are already struggling to cover your monthly expenses.
A change in address could highly impact your premiums. Should you be moving into an area deemed to be high risk, your risk profile will have changed. If you are changing your car’s overnight parking, you could be at risk of it being damaged or stolen. In the same way, if you have changed your job and are working at a new location, you will need to let your insurer know. If you are parking the car in a road outside of town, as opposed to in an access-controlled parking lot, you will find that you will be paying higher premiums. Make sure you do communicate this with the insurer, however, as if they find out that you have not disclosed the changes, they could terminate your policy.
4. Addition Of a Person To a Policy
Should you have added someone to your policy, your risk profile would have increased. The insurer will need to reassess your policy, and will probably increase it. Should you have added your teenager onto the policy, you can expect to pay a much higher premium than usual. The results of not putting them on, however, could be dire. Should your uninsured teenager cause an accident in your car, your insurer has the right to refuse to pay the claim. Make sure that they are aware of other drivers at all times, especially high-risk ones like young drivers.
5. You Have Recently Had a Big Birthday
Should you have recently turned 55 or 60, an insurer could possibly reassess your policy and increase your premium. Older drivers are considered higher risks than a driver in their 30’s, due to declining eyesight and response skills. You could possibly counter this by going on an Advanced Driving Course to lower the premium.
6. Changes To The Annual Fee Structure
In many cases, an increase in fees is the annual increase. Most insurers raise premiums annually and notify you of these changes to the rates prior to the time. You may, in between the notification and the increase, contact the insurer to do a reassessment on the vehicle to establish whether the premium can be dropped.