Legal & Insurance

Why does my car insurance keep going up?

Why does my car insurance keep going up

Why does my car insurance keep going up?? Why did it change? I did get this question all the time. So we’ll dig into the most common reasons that your auto insurance price can go up.

  • Rate Change
  • Loss of Discounts
  • Coverage change


Basically you need to understand a key term. The term is “Renewal”. A Renewal of insurance policy is the end of one insurance policy term and the beginning of a new policy. So every time you get your auto insurance policy, you have some dates on that. Depending on the term, it could be Six months or One year the most commonly. At the end of each that term, a new one will start. And when one term ends and new term starts, that is called a “Renewal”.

Let’s discuss the most common reasons Why does my car insurance keeps going up.

Company Rate Change

At each policy renewal, companies have the right to change the rate they charge. This can be based on a few things.

Claims paid out in the previous term

If a company sees that they are paying out of a lot of claims and ultimately they are losing money, then they are going to raise the prices of those policies. Then in the next term, they can make back the money they lose. They need to balance the claims going out with their premium income.

The general profitability of the company

Sometimes companies are losing their money on something else other than auto insurance claims. Maybe it’s for management. Then also they are going to increase your price of insurance. This could depend on the management decisions of the company. If it is a well-reputed and well-managed company, it will not increase your insurance price to cover their general purposes.


They can’t just radically change their insurance prices all the time for no reason. But they can really make insurance premium decisions based on almost anything. They do though have to make sure the insurance department is okay with that change. So, the company rate change is a huge reason why your prices could go up at renewal.

Tip: Try to Purchase always a 12-month policy instead of a 06-month policy. The 06-month policy gives more opportunity to raise your premium to the company.

How to get car insurance

Loss of Discounts

Insurance is based on discounts and there are a bunch of discounts. If you lose one of those, your price will go up.

8 Most common discounts are

  • Safe driving
  • Accident-Free
  • Credit
  • The Multi-s
  • Age & Gender
  • Paid in full
  • Loyalty & Intro
  • Association or Job


Coverage Change

Insurance companies can change the coverage options they offer at a renewal. This doesn’t happen a lot but can be confusing & hidden in the renewal documents.

Examples of changes could be

  •                Increased Deductibles
  •                Lowered Liability Limits
  •                Removal of roadside assistance

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