Jessica Sautter has a Bachelor’s Degree from Eastern Michigan University in Elementary Education with a Major in Reading and a Minor in Mathematics.

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Written by Jessica Sautter
Content Writer Jessica Sautter

Natasha McLachlan is a writer who currently lives in Southern California. She is an alumna of California College of the Arts, where she obtained her B.A. in Writing and Literature. Her current work revolves around auto insurance guides and informational articles. She truly enjoys helping others learn more about everyday, practical matters through her work.

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Reviewed by Natasha McLachlan
Content Writer Natasha McLachlan

UPDATED: Oct 1, 2020

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Have you ever taken a look at your monthly car insurance bill and wondered why it seems to be growing each time? If so, you are like many other people who are scratching their heads trying to understand this enigma. There are actually many reasons for an insurer to continuously tack more money onto your premiums.

Why is my car insurance going up?

Here are several common reasons for this occurrence and information that will help you bring things back down to a price you are satisfied with.

Parents Adding Young Drivers

Shock To See Car Insurance Premium Going Up

Many parents watch in awe as their children grow old enough to get behind the wheel. One thing that many do not realize is the fact that adding drivers who are under the age of 25 is considered a liability. As a result, your premiums can soar much higher than you have ever imagined.

It might seem like the simplest solution would be to have young adults apply for local jobs and purchase their own policy, but this is tricky when you have children whose calendars are filled with numerous family and school responsibilities.

One way to ease the financial burden is to encourage your child to do well in school. This will show the insurer that they are responsible and far from a liability. All carriers do not offer discounts to good students, so check with yours to see if this is offered.

Another way to combat this issue is to pay for driver’s education classes. The fact that your youngster is going the extra mile to ensure they are fully prepared to get on the road means lower rates for you.

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Your Vehicle Selection

Picking a car that is popular with thieves can significantly hike your premiums. Since the list of the most stolen vehicles of each year changes all the time, it can have an effect on the amount you are required to pay monthly. For instance, if you own a Toyota Camry (a vehicle that consistently makes this list) and it is sitting in 7th place this year, having it move to one of the higher positions, like 3rd, will increase the amount you are responsible for paying each month.

It may seem like there is no way to predict what type of vehicle will be stolen, but there is a way to minimize the risk. Take a look at all of the cars that made the list for the past 5-10 years. Avoid any that have appeared more than 2-3 times. Again, there is no guarantee, but it will definitely decrease your chances of becoming the victim of a car thief.

Changes To Your Credit Score

The average person is not aware of this, but there are some insurance carriers use your credit score to determine the rate they will charge you yearly. If you are someone who has a spotty history, it can lead to a pretty bumpy financial ride. Generally, people strive to keep their driving records clean by being safe on the road and avoiding tickets, but being irresponsible with your credit can throw a monkey wrench in things.

There are a few states, namely Hawaii, California, and Massachusetts, that have banned credit checks when it comes to determining a fair rate, but drivers in other areas certainly have cause for concern. In this case, the best course of action would be to focus on being more financially responsible.

These pointers to help you stay on the right path:

  • Avoid using credit cards for small everyday purchases. Things like cigarettes and bottled water may seem like small expenses, but the amount you will pay in interest and finance charges is not worth it. You would be much better off using cash or debit cards.
  • View your credit reports yearly. You are entitled to receive a copy of your report annually from each of the three major credit bureaus. They may not have the same information, so it is imperative you obtain a copy of each. Check closely to make sure there are no errors that might contribute to a slump in your score.
  • Stop applying for credit accounts far too often. Every time an inquiry is made, it has a negative effect on your rating. This means that frantically trying to sign up for every credit card you can find would be a terrible idea.
  • Instead of walking around with a wallet filled with credit cards, try cutting them all up and holding on to one. In addition, this should only be used to buy big-ticket items or in case of an emergency. In case of the former, using your card to buy something then paying it off in full the following month can help bring a dying credit score back to life.
  • Apply for a credit card if you do not have one. Whether you know this or not, a lack of credit history is as detrimental as having a tarnished one.

Many other practices can be adapted to improve your credit; this is just a start. As long as your credit is in good shape, you will not have to worry about being overcharged for auto insurance coverage.

Other Drivers’ Claims

Unfortunately, there are some companies that pass their fiscal burden onto others. Even if you are an impeccable driver with no history of accidents, claims or anything of the sort, that does not make you immune when it comes to the rate increase. When carriers have a difficult time trying to cover the cost of all of the claims they have received, it is customary for them to increase prices across the board.

Trying to appeal these price hikes is generally fruitless. The only way to avoid this would be to shop around and look for another insurance company to do business with. With so many options available to you, there isn’t any logical reason to remain loyal to an insurer who makes you pay extra due to circumstances that have nothing to do with you.

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Paying After The Due Date

Your goal is to show your insurance company that you are a responsible person. If you are late paying your premiums on a consistent basis, they will definitely believe otherwise and charge you accordingly. While it is doubtful they will go to the extreme and hike the rate if you are late once or twice over a long period, paying late regularly is a recipe for disaster.

If you know that you are a bit careless when it comes to keeping track of these things, you have two options. The first is to set reminders. There are numerous apps that can be helpful. The other would be to place your account on auto-pay. This is when the amount you owe is automatically deducted each month. Trying one or both of these is a great way to ensure you pay in a timely manner and avoid spikes in your premium.

Increased Traffic

There are various factors that can lead to an increase in traffic. The bad thing is that this can have some bearing on the price you pay for coverage. The more the roads in your area are congested, the more you will be expected to pay. The reasoning behind this is quite simple: More drivers on the road means a higher likelihood of an accident occurring.

Your first inclination might be to consider moving to an area with less traffic, but there is a simpler solution than that. Check to see if your carrier has a telematics program in place. This is when information is collected about when, how much and in what manner you are on the road. After this data is compiled, it is used to offer you a premium that is based on your driving, not that of those around you.

Human And/Or Technological Errors

If you notice your rate has gone up and there is no clear explanation, give your insurance company a call and ask questions. It may be possible that an error occurred somewhere and you are not actually expected to pay as much as you were told. You should talk to more than one representative if you inquire and you feel the person you speak with is dismissive and not open to the idea that a mistake may have been made somewhere along the line. There are countless people who accept higher rates without question; do not add yourself to this staggering number.


Car insurance is one of those expenses that people dread every month, but there is nothing that can be done about it. This is part of being a driver, but that does not mean that you should take every increase lying down. If you notice that your rates have skyrocketed, you need to do some digging to get to the root of the problem.

Now that you have a general idea of some of the more common reasons insurance companies raise prices, it should be easier for you to take all of the necessary steps to scale the rates back and make them more affordable.