‘Why Did My Car Insurance Go Up for No Reason?’

10 mins read

Being diligent about driving safely – paying attention to the road and others around you – and obeying traffic laws can help keep your insurance rates low, Mercury Insurance suggests. 

Auto insurance is a requirement of vehicle ownership in most of the U.S., so it’s something drivers need to account for in their household budgets. Occasionally, auto insurance rates will increase seemingly inexplicably, leaving customers confused and frustrated. However, insurance rates don’t increase for no reason, it just may not be obvious to those who have purchased the policy. Read on to get answers to the question: ‘Why did my car insurance go up?’

“Most auto insurance customers are aware there’s a correlation between their driving behavior and auto insurance rates,” said Kevin Quinn, vice president of claims and customer experience at Mercury Insurance. “Drivers with a clean driving record pay less for their premium than those who have been in a collision or have been cited for traffic violations because good drivers tend to be lower risk and less likely to need to file an insurance claim.

“Other factors that help determine your insurance premium are your age, years of driving experience, annual mileage driven and your claims history, all of which are pretty good indicators of your likelihood to be involved in a collision. Being diligent about driving safely – paying attention to the road and others around you – and obeying traffic laws can help keep your insurance rates low.”

So, if you’re a good driver with no claims and an overall low risk level, why did your car insurance go up?

There are several factors that affect car insurance rates unrelated to your driving behavior. A major one is vehicles have simply become more expensive to repair. The auto insurance industry periodically needs to make adjustments to account for the money paid out for repairs and replacements for all customers. Even if you aren’t involved in a collision, a lot of other drivers are and many of them are driving modern vehicles.

However, higher repair costs also come with the added benefit of more protection for a vehicle’s occupants and others on the road. Here are a couple safety features in newer cars that contribute to why they’re more expensive to repair.

Advanced driver assistance systems

The automotive industry has made significant strides over the past two decades to develop advanced driver assistance systems (ADAS) – from alerting drivers when they’re drifting out of their lanes to automatically applying the brakes to prevent rear-end collisions – that are helping to reduce collisions. In fact, the Insurance Institute for Highway Safety, Highway Loss Data Institute found in a 2019 study that vehicles equipped with forward collision warning had 27% fewer front-to-rear crashes. This number jumps to a 50% reduction when vehicles also have automatic emergency braking technology.

Here are some of the advanced driver assistance systems* available on today’s vehicles.

Blind spot warning: Well-positioned side mirrors and a quick glance over your shoulder were once the best way for drivers to know when it was safe to change lanes, but these systems provide extra visual alerts using cameras, radars and/or ultrasonic sensors alongside the vehicle to detect other cars that are traveling next to your car in your blind spot.

Forward collision warning: This system alerts drivers of an imminent collision in front of their vehicle, usually with another vehicle, but some also detect pedestrians and other objects.

Lane departure warning: Using cameras to monitor lane markings, this warning gives drivers visual and/or audible alerts to notify them when they’re approaching or crossing a lane if the turn signal isn’t activated.

Backup camera: When a vehicle is placed in reverse, this system displays the area behind the vehicle in a monitor on the dashboard. Backup cameras are legally required on all new U.S. vehicles as of May 1, 2018, as the result of a mandate the National Highway Traffic Safety Administration issued in 2014.

Automatic emergency braking: Working in conjunction with forward collision warning, this system can automatically apply the brakes to avoid or lessen the severity of a collision. Automatic emergency braking is expected to become standard on all new passenger vehicles by September 1, 2022, as part of a voluntary commitment by 20 automakers.

Lane keeping assistance: This system provides automatic steering and/or braking to prevent the vehicle from departing the lane. Some also have the ability to continually center the vehicle within its lane.

Adaptive cruise control: A vehicle that’s equipped with adaptive cruise control can accelerate and brake to maintain a driver-selected speed or distance between the vehicle ahead of it.

Many of sensors, cameras and radars needed to achieve these technological advancements are located in vehicle crumple zones which, in the event a collision still happens, means repairs are more complex and expensive.

LED headlamps

The Insurance Institute for Highway Safety (IIHS) now requires vehicles to come standard with good- or acceptable-rated headlights to be eligible for a TOP SAFETY PICK+ award, which is the highest award available from the organization. These headlights help address the issue of fatal crashes that occur on dark or unlit roads. Good-rated headlights on the low-beam setting, for example, illuminate the right side of the road ahead on a straightaway to at least 325 feet. Poor-rated headlights might light up to 220 feet or less.

More manufacturers are moving away from halogen bulbs and replacing them with LED headlamps because they increase visibility on dark roadways. LED – or light emitting diode – bulbs are brighter and often produce wider patterns than halogen bulbs, which aids nighttime driving. LED headlamps are also more expensive.

Ultimately, the technological advancements in modern vehicles are designed to reduce collisions, which is helping save lives and prevent injuries. The good news is, as this technology becomes standard on all vehicles, costs could eventually come down. And if your insurance rate increases through no fault of your own, you can speak with your insurance agent to try to negotiate a new rate or you can shop around for another provider.

If you decide to switch to another insurance provider, it is important that you do not rush into the decision. Though a cheaper insurance offer may seem much more attractive than your current rate, you need to ensure that you purchase the right insurance for you. After all, different insurance companies offer different packages – so take the time to figure out what each package offers before making a decision. For example, a quality insurance package can protect you financially if you are in a car accident but also provides protection in case of theft or other damages. 

Furthermore, you should contact a range of different companies outright, so that you can find the best deal. Don’t be afraid to ask around to see if any of your friends and family have any recommendations, as this can make the process of narrowing down the providers much quicker. Alternatively, you can do a lot of research online by reading customer reviews. Though it can be easy to lose focus during this time, especially if you seem to be reading document after document, it is worthwhile in the end – as finding Cheap Car insurance quotes can save you thousands of pounds. This means that you have more money to spend on yourself and can start saving for your next vehicle.

The ADAS outlined in this article use the common naming recommended in a joint effort by AAA, Consumer Reports, J.D. Power, the National Safety Council and SAE International.
Note: This article was originally published on the Mercury Insurance blog.

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