Why Do My Auto Insurance Rates Keep Going Up Even Though My Car Keeps Getting Older?

Why do my auto insurance rates keep going up even though my car is getting older? At Optistar Insurance Services, many of our clients ask this question so I would like to address it from a couple of angles.

First, let's address the car age piece. It's true that as your car gets older, the collision and comprehensive portions of your policy (which cover damage to your own vehicle) typically decrease in cost because the car's value is lower. So if your rates are going up, something else is driving that increase.

Reason #1: Liability Costs Are Rising. The liability portion of your auto policy — which covers damage and injuries you cause to others — has been increasing industry-wide. Medical costs, legal fees, and the cost of repairing modern vehicles (which are packed with expensive technology) have all gone up significantly.

Reason #2: Your Driving Record. If you've had any tickets, accidents, or claims in the past few years, those will cause your rates to increase. Most violations stay on your record for 3-5 years.

Reason #3: Where You Live. If you've moved to an area with higher rates of accidents, theft, or severe weather, your rates will reflect that. Even if you haven't moved, the risk profile of your area can change over time.

Reason #4: Uninsured Motorists. The number of uninsured drivers on the road has been increasing, which drives up costs for everyone. When an uninsured driver causes an accident, the costs often get spread across all policyholders.

Reason #5: Inflation. The cost of everything — parts, labor, medical care — has gone up. Insurance companies have to price their policies to cover future claims, so they adjust rates to keep up with inflation.

What Can You Do? Shop around! As an independent agency, Optistar Insurance Services can compare rates from multiple carriers to make sure you're getting the best deal. We also review your coverage periodically to make sure you're not paying for coverage you don't need. Contact us today.