What to do When Your Auto Insurance Rate Increases

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Written by Sarah Sharkey Edited by Quiana Darden Reviewed by Amanda Clear

Updated January 4, 2023

Car insurance is a necessary and beneficial investment when you own a vehicle. But, with the rising cost of insurance, it’s becoming less satisfying to make the payment. 

Why are rates increasing and is there anything you can do about it?

Let’s explore the reasons behind rising rates and how you can find an insurance policy that fits your budget, even in the midst of rate increases. 

Key Takeaways:

• Your actions may have caused your vehicle insurance rate to rise or have nothing to do with you.
• Contact your insurance company to ask about discounts to help make your car insurance premiums more affordable.
• Review your insurance policy for options you don’t need, such as towing, rental car reimbursement, or income replacement.

As Auto Insurance Prices Increase Satisfaction Declines

If you’re like thousands of other drivers, you’ve received a notice about rising insurance premiums upon renewal. The less than happy feeling you likely experienced is unlike that of many other drivers who felt the same thing.  The J.D. Power 2022 U.S. Insurance Shopping Study found that rising prices are driving customer satisfaction down. That trend seems to hold across both large and mid-size insurance companies. 

It’s not too surprising that drivers are unhappy with rising costs. After all, costs are rising across the board. On top of skyrocketing gas prices, the last thing you want to do is pay more of your insurance premium as well. 

What To Do If You Are Unhappy With Rising Insurance Costs

As the cost to be insured continues to increase, more customers are unhappy with the value of their coverage. If you’re facing rising insurance costs through your current insurer, there’s no need to stay unhappy. Instead, it might be time to make some changes. 

Here are the steps you should take if you are unhappy that your rates are increasing. 

Evaluate Your Insurance Policy

The first thing you should do is evaluate your current car insurance policy. Although your policy likely meets the state minimum requirements, you might have some wiggle room to make changes.

Depending on your financial situation, it might make sense to raise your deductible or lower your coverage limits. Either of these options should help you lower your car insurance premium. So, your car insurance payments will better fit your budget. Though lowering your coverage limits should be a last ditch effort. Reducing your limits can be costly for you if you’re involved in a collision. 

However, raising your deductible puts your finances on the line in other ways. If you have to file a claim, you might not have the funds to cover paying a higher deductible out of pocket. With that in mind, it’s important to make sure you have enough saved to cover this expense. If you don’t have the savings to make a higher deductible payment, then you should stick with your current deductible to be on the safe side. 

The same goes for additional insurance coverage. You might not be required to carry comprehensive or collision insurance. But if you cannot afford to cover the damage from a collision or other event, then continuing to pay for this extra coverage can be worth it for your financial security. 

A careful evaluation of your insurance needs is something you can do every time your policy is up for renewal. After weighing out the types of coverage available, you can decide how much insurance coverage you really need. 

Learn More: Auto Insurance Coverage Options

Consider Your Driving Habits

If you don’t put a lot of miles on the road, then you might be significantly overpaying for car insurance. A pay-per-mile option is likely a better fit if you drive less than 10,000 miles per year. 

A few situations in which you might be an infrequent driver are if you work from home or regularly carpool and use public transportation. Whatever your reasons for driving less, paying for traditional car insurance might be unnecessary. 

Instead, a pay-per-mile insurance policy could help you tap into significant savings. A pay-per-mile insurance policy works by charging drivers a low base rate. On top of that base rate, you’ll be charged by the mile.

Check For Discounts

When shopping for car insurance, there are plenty of discounts on the market. Although the available discounts won’t necessarily be obvious when you get your quote, you might still qualify.

A few discounts to look for include:

• Safe driver discount. If you haven’t been in an accident or gotten a traffic violation in recent years, an insurance company may reward you for your safe driving habits. 
• Good student discount. Are you currently in school? Maintaining a good GPA could lead to savings on your premium. 
• Pay upfront discount. If you can afford to pay your entire premium at once, you might receive a discount. It’s not uncommon to save around 10% with this approach. 
• Multi-car insurance discounts. If there are two or more vehicles on your policy, request a multi-car discount. 
• Multi-policy discount. If you can bundle other insurance needs with a single company, you might save on your premium. For example, you could bundle your auto insurance with a homeowners insurance policy. 
• Vehicle safety discount. If your car has the right safety features, many insurers offer a discount because it makes you a safer driver. 
• Defensive driving course discount. Learning defensive driving techniques can score you a discount on your auto insurance. 
• Military discount. Active military personnel sometimes get a discount on their policies. 
• Anti-theft discount. If your vehicle is equipped with anti-theft features, you could save. 
• New customer discount. If you switch insurance companies, you might receive a welcome discount to say thank you for trusting the company.
• Customer loyalty discounts. On the other hand, sticking with the same insurance company for several years may lead to you scoring a loyalty discount. 

If you believe you qualify for a discount, don’t hesitate to ask what they offer when you sign up. It never hurts to ask!

Learn More: Common Auto Insurance Discounts

Shop Around

The final and most effective way to find a better car insurance rate is to compare rates across multiple insurance companies. You might be surprised to find that you can usually save hundreds of dollars simply by switching your insurance provider. 

The thought of obtaining quotes from dozens of companies might seem like a time-consuming chore. But it doesn’t have to be! Instead, you can work with us at Compare to see quotes from multiple companies in just a few minutes. 

We work with over 65 auto insurance providers to help you find a policy that fits your needs and budget quickly. 

Bottom Line

If you are unhappy with your car insurance costs, you aren’t alone. Don’t settle for rising rates without taking every possible action to lower your car insurance premiums. 

Start by evaluating your policy needs and driving habits. Next, scope out any discounts you might qualify for. And finally, don’t forget to shop around. A switch to the right insurance company could be a welcome change for your wallet. 

Sarah Sharkey Auto Insurance Writer

Sarah Sharkey is a personal finance writer and auto insurance who loves diving into the details to help readers make savvy life choices. She has written for numerous publications, including Business Insider, SmartAsset, and Rocket Mortgage.