Why Did My Car Insurance Go Up?

"Why did my car insurance go up? I had no claims and my car is only one year older!"

“Why did my insurance premium increase? I haven’t been in an accident, gotten any tickets, or made changes to my policy.”

"Why did my auto insurance costs go up even when I didn’t file a claim?"

Sound familiar? My friend asked me this last week, and it’s a question insurance agents receive all the time. When the cost of your car insurance goes up at renewal, the increase can feel unjustified — especially if you’ve been insured with the company for a long time and haven’t had any tickets or accidents.

I felt the same way when the cost of my auto insurance increased by 28% last year (yes, insurance agents are impacted by premium increases, too!).

Even if you’ve been a safe driver, your car insurance rates can go up. Your frustration is understandable, and if you’re wondering why your car insurance keeps increasing — especially if you didn’t file any claims and you steadfastly followed the rules of the road — we’re here to clear up any confusion.

But before switching insurance companies, there are two important things to keep in mind.

First, rate increases aren’t unique to any one insurance company or geographic area. Premium increases are impacting drivers across the country for a variety of reasons.

Second, and more importantly, there are things you can do to off-set any premium increase you receive.

There are two sets of factors that can make the price of your car insurance increase. Knowing what could make your car insurance go up in price when you haven't had any claims can help you save money. When you understand the factors, then you are in a better position to negotiate the price and find an insurance company that will give you the lowest cost. 

Some car insurance price increases may be caused by factors within your control, but others are caused by widespread issues that are affecting drivers across the country.

How Does the Insurance Company Set the Price?

The first set of factors that impact your car insurance rate relates to the things that revolve entirely around your situation, the elements within your control.

10 Things That Can Make the Cost of Your Car Insurance Renewal Go Up

  1. Your claims history and driving record.
  2. History of convictions or driving violations causing surcharges.
  3. Change of address, placing you in a new area that may be more expensive regarding insurance.
  4. New drivers added to the policy or changes of the primary drivers of various vehicles on the policy.
  5. Cancellation of home policy, or other policy causing you to lose the discount for having more than one policy with the same insurer.
  6. The removal of a vehicle from the policy. Sometimes you get discounts for insuring more than one car. If you remove your second car, the price of insurance on the first car might go up.
  7. Change of employment. You may lose a group discount, a professional discount, or possibly have the distance to work change, making your rate go up.
  8. Medical conditions that increase your risk, or restrictions that cause reclassification to high-risk insurance due to convictions like drunken driving charges.
  9. Mistakes. Yes, insurance companies can sometimes make mistakes. Never assume that the rate you got is the best rate or that it is necessarily correct. There are computer and human errors that can occur, so it is always worth reviewing the factors with your representative when you're in doubt.
  10. Changes to the payment plan fees or structure on your insurance plan. Sometimes insurance companies change the financing rates or add new service charges that you may not have noticed. Take a look at your payment options and make sure you choose one that best meets your needs. Some companies offer zero financing, and others can charge up to 5% or more. This can impact your actual annual insurance cost.


Why are insurance companies raising rates?

At its most basic form, the premise of insurance is sharing risk and shouldering costs with others. Although your individual circumstances or driving behaviors may not have changed, all of us are impacted by the following:

  • Worsening traffic. Increased population, higher employment rates, and lower gas prices led to vehicles travelling 653 billion miles on Washington’s roadways in 2015, an all-time high. According to the Washington State Department of Transportation, freeway congestion in central Puget Sound also increased by 35.7% from 2013 to 2015. When more cars are on the road, the frequency of accidents inevitably increases.
  • Distracted driving. It’s no secret drivers do dangerous things behind the wheel. Talking and texting on cell phones, using in-vehicle technologies like navigation systems, and eating and drinking all take a driver’s attention off the road. A newly released survey by the Washington Traffic Safety Commission shows distracted driving deaths in Washington are up 32%. Nationwide, every day more than nine people are killed and 1,153 injured in crashed that are reported to involve a distracted driver (CDC).
  • More claims. Statistics from the Insurance Research Council point to  increasing frequency and severity of auto insurance claims. From 2005 to 2013, the average cost per bodily injury liability claim increased by a whopping 32.1%.
  • Rising costs. These days, it seems like we pay more for just about everything. The cost of repairing vehicles is no exception. Newer cars have advanced technology – like blind spot detection, forward collision warning, and backup cameras – that is more expensive to repair. The U.S. set a new car sales record of nearly 17.5 million vehicles in 2015, so this problem will only increase. (Strategy & Price WaterHouse Coopers)

How Can I Lower My Car Insurance Premium?

Most importantly, drive carefully. Observing traffic rules and speed limits and avoiding moving violations and accidents is the best way to reduce your insurance costs over time. There are also many immediate solutions to lowering your auto insurance premium:

  • Work with an independent insurance agent. There is no one-sized-fits-all solution when it comes to insurance. Unlike a “captive” insurance agent that works with only one company (think State Farm or Allstate), independent agents partner with a wide range of insurance companies. This means we can find the best combination of price and coverage for you. Insurance pricing is based on hundreds of variables and can vary dramatically from company to company. An independent agent can help navigate these variables and review your eligibility for premium discounts with each company. For example, many companies offer discounts based on billing plan, driver safety courses, school employees – even University of Washington graduates! We are truly working for you, not one single company. Best of all, our services are free!
  • Choose a higher deductible. It may be tempting to choose as low of a deductible as possible, but selecting $1,000 comprehensive and collision deductibles instead of $250 or $500 deductibles has multiple benefits. First, you immediately benefit from a lower premium (the lower the deductible, the higher the cost of the coverage). Higher deductibles also discourage you from turning in small claims. When you turn in a claim, you may lose eligibility for a company’s claims free discount. This means it can be more cost effective in the long run to pay out of pocket for a small claim, like replacing a broken windshield, versus turning it into your insurance company.
  • Enroll in a company’s telematics program. Insurance company telematics programs, like Safeco RightTrack or Progressive SnapShot, are becoming more and more popular. These programs collect information about how you drive, how much you drive, and when you drive. Insurance companies use this data to personalize your car insurance rate based on your actual drivingYour safe driving habits can help you save on car insurance – in some cases up to 30% of the premium.
  • Bundle and save. Most insurance companies offer a multi-policy discount when you insure your home and auto with them. This discount can be as high as 25%, so it pays (literally!) to have your policies with the same company. Bonus: bundling your insurance with one company also simplifies billing, streamlines claims, and helps eliminate dangerous coverage gaps.


How to prevent your auto insurance rates from rising

Crashes and violations

“There are things that cause your insurance rates to go up that can be prevented, such as having car crashes or getting violations,” Wukovits said.

Drivers who accrue too many speeding tickets will also likely see a surcharge or have their insurance tier adjusted, he said. The tier system is a relatively new way of doing things in the insurance industry.

“Persons with the least number of occurrences pay the lowest rate,” he said. “If you have more accidents or speeding tickets, you pay more.”

The insurance provider uses the tiers to rank customers based on their risk of being involved in another vehicle mishap. While not many people like to be ranked, the industry uses the system to get a more precise evaluation of your driving habits and it sometimes helps prevent rates from skyrocketing for a driver just because of one accident.

Age and location

Your age and where you live can also affect your insurance rates. Drivers who put newly licensed teenagers on their insurance policies will see their auto insurance rates increase, since teenagers are typically involved in more crashes than any other age group.

And where you call home could make a difference in your auto insurance rates as well.

“If you move from Westchester County to Queens or Brooklyn, you’ll pay more money due to the exposure [to crashes],” said Wukovits. Some cities also have a higher rate of vehicle thefts and others also require drivers to have glass coverage for their vehicle’s windshield, which can lead to more expensive car insurance rates.


It might seem like just yesterday when you completed your six-hour defensive driving course, but the certificates of completion only net you a discount for three years. If your car insurance rates have recently gone up, ask your insurance agent if you have had any discounts recently expire. While you’re at it, ask if you or your family members qualify for any additional discounts like a good driver discount, auto club discount or good student discount for your son or daughter with good grades. Some providers also offer discounts for safety features on your car, pay in full discounts, multi-vehicle discounts and bundling home and auto insurance policies together. Make sure you’re not missing out on these savings!


Lastly, insurance rates go up for all drivers due to the fraudulent practices of a few. Examples include drivers who moved but didn’t report it, parents who don’t add teenage drivers to their insurance plans to prevent increases, staged accidents and drivers who ask for higher estimates at body shops. Unfortunately, these actions affect what others pay for auto insurance rates.

As we mentioned earlier, drivers can complete a defensive driving course for up to a 10 percent discount on their auto insurance rates for three years. This discount applies to collision, liability and no-fault insurance. Drivers can also reduce up to four points on their driver’s license by completing the course.

Auto insurers price their policies based on a number of factors. Sometimes these cost factors go up, and sometimes they go down. In most states, costs are currently rising. Your actions, as a policyholder, can affect what you pay, too. For instance, if you add another car, or a teenaged driver to your policy, your costs will increase. Alternatively, your costs will decrease if you drop either a car or a driver from your policy.

But there are also other factors outside of your control that could cause rates to increase, such as the crashes other people are involved in. The number of crashes, and the cost of these crashes, are a component of auto insurance pricing in every state. For example, drivers living in large metropolitan areas are likely to pay more. This is simply because more cars, therefore more crowded roadways, increase the number of car crashes in those cities. On top of all that, speed limits are also being raised. Speed is the single-biggest contributor to crashes in which driver error is cited as the cause. Distracted driving is an issue everywhere. In big cities and small, people texting, talking or otherwise occupied with another activity while driving is being blamed in part for more crashes.

Auto insurance covers more than vehicle repair. It also covers the cost of injured crash victims’ medical care and lost wages as well as the repairs and/or replacement of vehicles and any property damaged in a crash. In recent years, medical and auto body repair costs have increased at a rate much faster than inflation. Legal costs have gone up, too.

Another trend affecting the cost of auto insurance is that with the unemployment rate falling, more people are driving both to and from work. And with more disposable income, they are presumably driving more for leisure. They also have the means to purchase more expensive cars. And while many of these cars have all types of safety features that might help in accident avoidance, these cars’ often high-tech components are also more expensive to fix and replace once damaged.

Auto insurers are committed to reducing U.S. crash rates. They fund the Insurance Institute for Highway Safety (IIHS), support efforts to combat distracted driving as well as drunk or drugged driving. In addition, auto insurers offer discounts to policyholders who take defensive driving courses or drive fewer miles. 

Consumers can take proactive and positive steps to reduce auto insurance costs. Talk to your insurance professional to make sure you’re getting all of the discounts to which you’re entitled. And if you’re not satisfied, shop around to see if another auto insurer offers you a policy which meets your needs at a lower cost. 


[1] Why did my car insurance go up for no reason? https://cover.com/blog/why-did-my-car-insurance-go-up-for-no-reason/

[2] Why Did My Car Insurance Go Up? How-To Take Control and Get Discounts https://www.thebalance.com/car-insurance-prices-up-with-no-claims-3881505

[3] Why did the cost of my car insurance go up at renewal time? https://www.economical.com/en/blog/economical-blog/october-2018/why-did-the-cost-of-my-car-insurance-go-up

[4] Why is My Car Insurance Going Up – And What Can I do About It? https://www.autohomeboat.com/blog/why-is-my-car-insurance-going-up-and-what-can-i-do-about-it/

[5] Why Did My Car Insurance Go Up? https://www.amfam.com/resources/articles/understanding-insurance/why-did-my-auto-insurance-rate-go-up

[6] Why did my auto insurance costs go up even when I didn’t file a claim? https://www.iii.org/article/why-did-my-auto-insurance-costs-go-up-even-when-i-didnt-file-a-claim

[7] Why Did My Auto Insurance Rates Go Up? https://magazine.northeast.aaa.com/daily/money/auto-insurance/auto-insurance-rates-go-up/