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Many people are asking what could cause your auto insurance premium to increase or possibly even decrease.  There are multiple reasons why your auto insurance premium could fluctuate, and we as an independent insurance agency feels it’s very important that you are well aware of these mitigating factors.  An increase in your auto insurance premium could be due to:

· Tickets:  Speeding, reckless driving, improper turn, etc.

· Accidents (At fault or not at fault):  Whether you are found at fault or not, filing a claim with your insurance company could increase your premium.  An at fault accident is more likely to cause an increase.  We don’t promote to not file a claim, just to be aware that it could affect your premium.

· Multiple Windshield Claims:  It’s a common misconception that windshield claims can not affect your insurance premium when they actually can.  It’s unlikely that one windshield claim would have much impact on your insurance premium, but multiple claims certainly could.  You may not see a direct increase, but claims are a part of what is used to determine your insurance score.  A lower insurance score will lead to an indirect premium increase.  We have even seen some carriers remove Comprehensive coverage (the coverage that applies to windshield claims) from policies with excessive claims.

· Youthful drivers:  Younger drivers tend to have a higher premium because they are often looked at as more risky then an individual in his or her 30’s or 40’s.

· Exotic/expensive cars:  Sports cars tend to be considered more risky.  They also cost more to repair or replace, so in turn usually yield a higher insurance premium.

· Switching carriers too often:  We recommend that you periodically shop around, but not to switch carriers too often. 

· Moving to a different location:  Each state and county has their own rates.  It is more risky to drive in congested areas versus rural areas and the rates reflect this.  Even moving your garaging address just a few miles can have an impact up or down on your premium. 

· Credit:  Credit is used by almost all auto insurance carriers today and it continues to become more sophisticated.  Although it is still somewhat of a touchy subject, bad credit statically shows that there is a higher risk.  Credit, like claims history, is a part of what makes up your overall insurance score. 

· Lapse in coverage:  Insurance carriers do not like to see a client without coverage.  Be careful not to let your coverage expire or lapse.

As you can see there are various ways in which your insurance premium could be increased.  There are also many ways that you could ensure a lower insurance premium such as:

· Driver’s Training Course:  There are many driver’s courses out there that you can take that could be applied to your insurance policy and provide you with a discount.

· Credit:  Just as bad credit can hurt you, good credit will lead to a better premium.

· Bundling:  This discount is often given when you purchase multiple insurance policies through the same company or agency.

· Good Student Discount:  Most carriers give a discount for full times students with a 3.0 GPA or higher.

· Loyalty:  This is given to customers after they have been with a company for a certain amount of years.  This varies by carrier, but some start giving a discount after one year.

· Higher deductibles:  Pretty simple - The higher the deductibles the lower the premium, the lower the deductible the higher the premium.

· Pay-As-You-Go Insurance:  The name of this is a little misleading.  What we and the industry means by this basically is – rates are based on the number of miles you drive.  For example:  Progressive, Safeco, and other carriers have programs where you plug a device in your car or that sinks to OnStar.  In addition to mileage, the device can also record speed, time of day driving, and braking patterns.  People that drive very little and are very cautious could see a considerable discount.

Even though insurance may seem like a hassle or confusing at time, it’s really there to help provide you with peace of mind.  If you ever have any questions regarding an increase in your own insurance policy or any other questions please don’t hesitate to give us a call here at Davis & Massey Insurance Agency at (843) 839-9229.

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