Recession has affected car insurance rates too. All around the US, rates are rising. In California, the rates this year are 10% higher than last year. Yet the average car insurance premium in this state, at $1710, is considerably less than the national average premium of $1790.
Car Insurance Rates
Traffic violations are found to be one of the major causes of high car insurance rates in the nation. The increasing number of accidents and resultant claims prompt insurance companies to hike auto insurance rates.
California Law sets the following minimum auto insurance coverage.
1. Liability Bodily Injury - $15000 – per person coverage
2. Liability Bodily Injury - $30000 – per accident coverage
3. Property Damage Coverage - $5000 – Other cars and other types of property
Earlier when it was so easy to avail discounts for good driving and accident-free records, these offers have become rare in auto insurance companies, across the state. On their part, car insurance companies say that the payments made by them for claims are on the rise and that is what has resulted in higher car insurance rates.
Factors that influence Car Insurance rate
· Higher auto insurance rates are the result of rising costs of repair parts, labor employed in the industry
· Resale values of car models, that are not being manufactured any longer, are dropping. So car insurance rates for these cars tend to be higher
· A car is classified as a “total loss” when, after an accident, the repairs exceed about 70% of the car’s cost. This is when the insurer received a cheque for the car’s existent market value and the car is sent to the salvage yard. This is the costliest claim for those who insure.
· With recession comes an increased trend of fake claims in the auto insurance sector; this too contributes towards hike in car insurance rates. It is alleged that car owners, I great need of money, even destroy their vehicles in order to stake insurance claims
· High prices dissuade car owners from shopping for accessories. Dismal sales of these accessories forces manufacturers to raise the price which in turn affects car insurance rates
· Getting speeding tickets or being involved in accidents raise the car insurance rates sharply
How to keep your car insurance rates low
· Locate the most affordable quote for car
· Maintain an accident-free and constantly updated driving record
· Search for and avail as many discounts you are eligible for like senior citizen discount, professions that have minimum risk, comprehensive coverage, affiliation to professional organizations, and so on.
· Choose a car that is accessorized with safety enhancing features
· Find a policy that offers coverage to a maximum number of risks you want to include
· It makes sense, therefore that you do your homework thoroughly and shop for the best car insurance rate. As in other states, even in California, car insurance rates are generally based on the data available about driver versus population. Yet, you can find an attractive and affordable rate to suit your special needs.
· Remember also that the better and more careful driver you are, the more chances of getting affordable quotes for insurance coverage.
· You can get lower rates by combining other insurance such as home insurnace with your car insurance
· Staying with the same insurance company over a period