So many factors are driving the price of auto insurance up these days. Higher new car prices and soaring repair costs are just two reasons many people have seen their rates increase 20% or more in the past year.
But other drivers are seeing even higher rate hikes because their cars are more susceptible to crime.
Rebecca Long is one of those people. The mom with three vehicles in her household doesn't know how she'll afford the huge increase in her auto insurance.
"It is increasing almost $900 for the next six months," she said. "I honestly thought it was a mistake."
But it was no mistake, and she is not sure how she will handle it.
"The fact that we have to change car insurance or get a different car is kind of disheartening to me," Long said.
Certain Hyundais and Kias seeing big premium hikes
Her "declarations" page shows her rates soaring from $1,700 every six months to $2,600.
The vehicle with the biggest jump: her 2016 Hyundai Sonata, up from $857 to more than $1,200, because she says it's now considered a high-theft vehicle after a famous TikTok challenge led to thousands of thefts and attempted thefts.
Certain Hyundais and Kias with old-style key ignitions are triggering higher rates at many insurers, according to NerdWallet, while some say companies won't insure those cars at all.
"I asked them if due to the fact that I have a Hyundai, is that one of the reasons my rates are going up and they said 'yes,'" Long said.
A 2024 annual report from Bankrate shows the average car insurance policy is now more than $2,500 per year. For a family making roughly $74,000 a year, that's nearly 3.5% of their income.
Divya Sangameshwar with ValuePenguin says your driving record, recent severe weather and crime all contribute to rising costs.
Ways to lower your premium
So what can you do? Sangameshwar says it pays to shop around. According to ValuePenguin, most consumers who comparison shop find a better rate.
"So for less than an hour's work, you're going to save a significant chunk of money from your premiums," she said.
Sangameshwar says if you decide to stick with your current insurer:
- Ask about usage discounts if you work remotely or don't drive much
- Bundle with your home or renters' insurance
- Remove optional coverage like roadside assistance, which you may already have through AAA or your credit card
- You may be able to raise your deductible, for instance from $500 to $1,000, though realize you will pay more out of pocket in the event of an accident
But even a good driving history may no longer protect you from rate hikes, Long learned.
"We have a clean driving history, no accident claims, no speeding tickets," she said.
Yet she is looking at a significant rate hike this year.
So be prepared, and take action if your rates jump sharply, so you don't waste your money.
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