car insurance question

[Special K]

I realize that insurance rates are computed based on a number of factors and it's therefore impossible to make extremely general statements about them that apply to everyone, but I just received my auto insurance renewal information in the mail today, and Amica is jacking my yearly premium up by 12%, despite me not filing any claims, receiving any tickets, etc. during the previous year. They are increasing my renter's insurance premium by 15%, again without any claims or negative information from me during the previous year.

I spoke with a CSR and she confirmed that there was no negative information on my record that would have led to the increased rates (i.e. a ticket or claim), but couldn't give me any more information as to why my premiums were increasing so much.

I went with Farmers Insurance the previous year, and they did the same thing to me when my policy came up for renewal, which is why I switched to Amica.

For some reason, I was under the impression that your rates wouldn't really change much if you didn't file any claims, get any tickets, etc. An increase of 12-15% seems excessive, but then this is only the third time I've shopped for car insurance.

Is this experience normal? Is it pretty much expected that even drivers with perfect records will have to shop around every year to keep from getting screwed on rates?

Has anyone here been with the same insurance company for a long time, not filed any (or many) claims, and not seen such large increases in their yearly premiums?

 

[GeekDrew]

I've been with Nationwide for Auto insurance for 8 years, and my premium has only increased when I've purchased a new vehicle. It's otherwise only gone down. I've never filed any claims.

 

[Gooberlx2]

Yearly premium for auto? I thought auto insurance was usually a 6-month premium.

Anyway, best answer I can give is, "it depends". I could see $60 fluctuations on $500 premiums, that's 12%. Did you move, change jobs, locations, distances to work, etc...? Was there a spike in crime in your area?

edit:
As others have said though, usually my premiums go down when there's nothing to report. You can always haggle, but I agree that it is a PITA,.

 

[Gibson486]

1. It may have gone up due to "increased cost of living". Some insurance companies (such as liberty mutual) have increased their base rate "due to the economic down turn".

2. Generally, yes, it does go down. If you are not happy with yoru rate, start shopping. It is not that hard.

3. Are you basing your increase based on monthly payment? if so, did you put down a down payment (some companies require this)? If so, when your new policy begins, the downpayment is no longer applied and you begin paying the full amount (before, it would have been full amount - downpayment).


BTW....

I used to be insured with liberty mutual. After a year of citation free driving and living in Boston, MA...I moved to the boring suberbs of Natick, Ma and got an increase of 12% for no reason (you'd thinking that living in the city would cost more). I said screw it after they gave me stupid excuses for the increase and moved to progressive and now I pay $300 for 6 months (I was paying 1920 for a year, then it went up to 2150 for no reason).

 

[Gibson486]

Originally posted by: Gooberlx2
Yearly premium for auto? I thought auto insurance was usually a 6-month premium.

Anyway, best answer I can give is, "it depends". I've could see $60 fluctuations on $500 premiums, that's 12%. Did you move, change jobs, locations, distances to work, etc...? Was there a spike in crime in your area?

some companies do it on a yeary basis. They usually cost more too, but they also are noted for better customer service.

 

[CountZero]

I've had the same renter's insurance for 8ish years and it only increased when I moved from WA to TX. I've had the car insurance for 2 years and it renews every 6 months and the rate has changed minimally (once it went up a bit another time down a bit).

What state do you live in? Is it possible there have been laws that have changed the likelihood that you will cost them money? Have you had any type of credit ding, a lot of insurance companies use credit rating as part of their rate determination.

I'd guess that your rate is determined by a computer somewhere that takes a number of variables and spits out a rate and something in that has changed year to year at your expense. I'd guess no representative will be able to tell you exactly why it went up.

I'm with State Farm if that makes a difference.

 

[Svnla]

OP, if everything stay the same, you should get the same or slightly less premium when you renew (at least it was in my case..even I moved 3 times in the last 10 years).

Make sure your credit scores are up and up. More and more insurance companies are using credit scores as tools to set premium.

I have been a customer with StateFarm for years (over 10 years IIRC) and they only went down, never up, slightly every year.

 

[Special K]

I read through the replies and here are answers to some questions:

1. I haven't changed addresses since I bought the policy last year
2. I live in TX
3. I'm not aware of any spike in crime in the area
4. This insurance didn't require any downpayment - I'm comparing apples to apples here
5. Regarding the issue of credit - I did see the following notice in the booklet containing my new renter's insurance policy:

"Based on information in consumer reports, including a credit-based insurance score, you are not receiving our lowest premium."

"Items that affected your insurance score are: Unfavorable percentage of recently opened revolving accounts to all revolving accounts or no revolving accounts; Insufficient length of time since most recent account established".

Granted that could explain the increase in the renter's insurance premium, but that information didn't appear in the booklet containing my auto insurance policy, so I would assume it wasn't an issue there. The CSR agreed with me on this.

I pulled a free copy of the credit report Amica used and didn't see any negative information on there. All accounts were in good standing, no late payments, etc. My most recent account was a Dell DPA opened in February, but if that one card is enough to cause such large increases in my insurance premiums, then I'm not sure what else to say. I always pay it in full and it even had a $0 balance when they checked my credit report.

 

[EagleKeeper]

Originally posted by: Special K
I read through the replies and here are answers to some questions:

1. I haven't changed addresses since I bought the policy last year
2. I live in TX
3. I'm not aware of any spike in crime in the area
4. This insurance didn't require any downpayment - I'm comparing apples to apples here
5. Regarding the issue of credit - I did see the following notice in the booklet containing my new renter's insurance policy:

"Based on information in consumer reports, including a credit-based insurance score, you are not receiving our lowest premium."

"Items that affected your insurance score are: Unfavorable percentage of recently opened revolving accounts to all revolving accounts or no revolving accounts; Insufficient length of time since most recent account established".

Granted that could explain the increase in the renter's insurance premium, but that information didn't appear in the booklet containing my auto insurance policy, so I would assume it wasn't an issue there. The CSR agreed with me on this.

I pulled a free copy of the credit report Amica used and didn't see any negative information on there. All accounts were in good standing, no late payments, etc. My most recent account was a Dell DPA opened in February, but if that one card is enough to cause such large increases in my insurance premiums, then I'm not sure what else to say. I always pay it in full and it even had a $0 balance when they checked my credit report.

Ask them why you are not receiving the lowest premium and then also ask for explanation of the increase.

You may have to go above the CSR level to get answers.
If you have to bring up the State Insurance Division as leverage

 

[Special K]

Originally posted by: Common Courtesy

Originally posted by: Special K
I read through the replies and here are answers to some questions:

1. I haven't changed addresses since I bought the policy last year
2. I live in TX
3. I'm not aware of any spike in crime in the area
4. This insurance didn't require any downpayment - I'm comparing apples to apples here
5. Regarding the issue of credit - I did see the following notice in the booklet containing my new renter's insurance policy:

"Based on information in consumer reports, including a credit-based insurance score, you are not receiving our lowest premium."

"Items that affected your insurance score are: Unfavorable percentage of recently opened revolving accounts to all revolving accounts or no revolving accounts; Insufficient length of time since most recent account established".

Granted that could explain the increase in the renter's insurance premium, but that information didn't appear in the booklet containing my auto insurance policy, so I would assume it wasn't an issue there. The CSR agreed with me on this.

I pulled a free copy of the credit report Amica used and didn't see any negative information on there. All accounts were in good standing, no late payments, etc. My most recent account was a Dell DPA opened in February, but if that one card is enough to cause such large increases in my insurance premiums, then I'm not sure what else to say. I always pay it in full and it even had a $0 balance when they checked my credit report.

Ask them why you are not receiving the lowest premium and then also ask for explanation of the increase.

You may have to go above the CSR level to get answers.
If you have to bring up the State Insurance Division as leverage

I asked the CSR specifically what they saw on my credit report that caused me to not receive the most favorable rate, but she couldn't help me. She just spouted off canned responses like "paying your bills on time helps build a positive credit history" and "shuffling revolving balances from one credit card to another can hurt your credit score" - yeah, no crap.

Should I just ask to speak to their supervisor? Would there even be anyone working there who could actually give me a straight answer?

 

[summit]

did you put on more miles this year than last year? amount driven or planned to drive is a significant factor.

 

[Special K]

Originally posted by: Summit
did you put on more miles this year than last year? amount driven or planned to drive is a significant factor.

It's likely I have driven more this year than last, but how would they even know that? I never had to report my odometer reading to the insurance company.

 

[slsmnaz]

forget the CSR and call your agent

 

[Gibson486]

OK....now there is too much work going on....

just move to another company. most CSR's from insurance companies will not have the answer. Your rate is determined by statistical data that the CSR's do not even understand and there bosses will not either. Also, threatening to walk away will not lower your rate either, so you can imagine how hard this will be to challenge. If you really like Amica, then go to a different company for a year and then get a new quote from Amica later on.

 

[Special K]

I priced identical coverage from a bunch of the other major insurance companies and Amica still came out the cheapest. I guess all insurance companies are raising their rates for whatever criteria they are using from me.