Why is Car Insurance so Expensive?

by Kristin Smith

When it seems that everything costs more these days, you may ask why car insurance costs go up. You drive the same car the same way you have month after month and year after year, so why did my car insurance go up? Consider two categories of factors – things you can’t control and things you can. 

Car insurance factors you can’t control

Rising costs of parts and repair

Today’s cars have more technology. Back in the day, a fender bender resulted in a small repair and a small repair bill. Today, you’re replacing more than a bumper. With sensors and camera, the more bells and whistles, the more it costs to fix.

Increasing medical costs 

When health care prices rise, so do auto insurance rates because auto insurance covers the medical costs of those injured in accidents or collisions.

Where you live

So, maybe you can control where you live, but moving to save money on car insurance would be a little extreme. Certain factors about your geographic area can affect your car insurance rates. For example:

More accidents in your area

If you live where there is more traffic and more accidents, your rates will likely be higher than rates in more rural, less trafficked areas. 

Increase in car theft

A high rate of vehicle theft in your area could increase your car insurance. When insurance companies are paying claims for car theft, they may need to increase rates to cover the rising risk.

Ways you can help control auto insurance cost

While you can’t control car repair or healthcare costs, you can help control the cost of car insurance.

Drive safely

Maintain a safe driving record

If you avoid traffic violations and car accidents, you’ll keep your car insurance cost down. Insurance companies reward good drivers with auto insurance discounts. 

Consider telematics like our DriverIQ Program

Using telematics programs that monitor your driving behavior can not only make you a better driver, but it can also save you money. When you enroll and participate in COUNTRY Financial DriverIQ, you will receive an introductory 10%¹ discount on your auto insurance. With safe driving, at each renewal your discount can range from 1% up to 25%, based on your driving performance.

Avoid distractions when you drive 

Distracted driving accounts for a high number of car accidents. According to the National Highway Traffic Safety Administration, the “estimated number of drivers using electronic devices during the day is 660,000.” That includes people who text, snap photos, record videos, and more. The younger the driver, the higher the distraction rates. So, put your cell phone away and encourage your teen driver to do so, too.       

Avoid other distractions by reviewing your route and setting your playlist before you leave. Keeping your hands on the steering wheel and eyes on the road will improve your driving. 

Choose a safe car and take care of it 

When you car shop, contact your insurance agent before you buy to get the cost of auto insurance. Some cars are more expensive to insure than others. Key factors include the actual car cost, safety features, and age of the vehicle. Also, some cars are more often targeted for car theft and, as a result, are more costly to insure.  

Once you have your car, keep up with oil changes, brake repair, tire replacement, and other necessary maintenance. A well-maintained car is a safer car and can help keep your driving history clean.

Drive less

Join a carpool with friends of colleagues. If you work at the same place or are close to each other, you can take turns driving. You’ll save some gas money, reduce the number of cars on the road and have time to connect with your friends.  

Be sure to report mileage reduction to your insurance agent. One factor in your insurance rates is annual mileage, so you may be able to save by reducing the miles you drive.

Combine insurance with the same company

When you have your car and home insurance with the same company, you’ll likely qualify for car insurance discounts. And if you add other types of insurance, like life insurance, you could save even more. Talk with your insurance agent to see if you’re eligible to move all your insurance to COUNTRY. You could save money. 

Keep your credit score high 

People who pay their bills regularly and maintain a high credit score are typically better insurance risks and qualify for better auto insurance rates. Minimize your debt and stay current on your bills to boost your credit score to save on insurance. 

Updated 5-19-23