Following the COVID-19 pandemic, car insurance rates are shooting back up. Many Americans received discounts, breaks, or another form of change that temporarily made their rates more affordable. With the shift back to normalcy, you might see a massive rise in car insurance costs. According to Consumer Reports, you can take a few steps to keep the costs down as much as possible.
Why are car insurance costs on the rise?
According to Consumer Reports, car insurance premiums fell an average of 4 percent in 2020 thanks to COVID-19 keeping so many people home. Fewer drivers mean fewer risks of danger, so this change makes a lot of sense. The following year, drivers were back out on the streets, and premiums shot up 4 percent to an average of $1,529. Over the last 10 years, CR reports the average annual car insurance premiums have increased a total of 28 percent.
The amount you pay for insurance is tied to many different factors. Some of these include your location, level of education, job title, and more. CR says insurers may charge more to people with less schooling or a less prestigious occupation. Insurers have also started to use devices that transmit driving habits to them, which could benefit some. If you’re someone who often drives fast or brakes hard, these devices could end up raising your rates instead of lowering them.
How to keep yor car insurance costs down
1. Shop Strategically
A 2019 Consumer Reports survey found that 54 percent of its members stayed with the same insurance company for 15 years or longer. This is a common habit and is probably less of a hassle but can be detrimental to your car insurance costs. Contacting direct-writer insurers like Amica and USAA, then an independent agent annually, is essential. Comparing companies offering insurance to find the best rate not only results in a lower cost, but it can change every year without warning. While your provider’s costs might’ve risen for 2022, another might be offering newly low rates.
2. Choose a top-rated insurer
Don’t automatically go for the provider offering the lowest premium. Other factors are important to weigh as well. Things like fair and fast claim settlements, good customer service, and helpful advice are imperative. Best of all, you don’t have to find out these measurements for yourself. Consumer Reports provides car insurance ratings and reviews, including each of these factors and costs.
3. Don’t skimp on essential coverage
Don’t cheap out on car insurance because it’ll end up costing more when something goes wrong. CR recommends getting more than the legal minimum, regardless of the assets needing protection. Carrying enough liability coverage to pay for bodily injury and property damage you could cause to someone else in a crash is crucial. Additionally, some states could take a portion of your wages in a judgment against you in the event of an accident that’s deemed your fault if your car insurance isn’t good enough.
4. Look for cost-cutting options
According to CR, choosing a $1,000 comprehensive and collision deductible instead of $500 can reduce your costs by 15 percent. If you’re insuring an older car, consider getting rid of collision and comprehensive altogether. This is cost-saving because you’ll end up paying more for the insurance than you’d get in repair or replacement costs. Most importantly, this only applies if you’re driving an old, very cheap model.
5. Drive carefully
Some of the most devastating things to impact car insurance costs are violations and claims. Consumer Reports states that getting caught using a cell phone while driving can increase your premium by more than 20 percent. In addition, speeding tickets, citations for at-fault accidents, or reckless driving often result in increases as well. While no one is perfect, avoiding simple things like using a phone while driving and being careful on the road can save a lot of cash.
What else controls car insurance costs?
There are loads of different things that can control the cost of car insurance in your specific area. For example, last year, premiums rose in 37 states and Washington D.C. One of the states, Louisiana, went up a whopping 42 percent because of hurricanes and other weather-related events. Only 13 states saw rate declines, most notably Maryland, which dropped by 9.2 percent.
Lastly, the type of car and its safety features impact your rates as well. While safety features may lower the cost, the more technology your car has, the most costly it is to fix. Surrounding a car in sensors, cameras, airbags, and more is safe, but also thousands and thousands of extra dollars to repair or replace. Driving a cheaper car will often result in more affordable rates.
In conclusion, there are some things everyone can do to control the cost of their car insurance. While much of it is out of your hands, research and choosing the right coverage are essential. Don’t get screwed over by insurance companies, and make sure to be as careful as possible every time you drive. Outside of serious emergencies, there’s nothing on your phone that can’t wait until you’ve arrived at your destination.