What are the reasons for annual Insurance Premiums Increase?Every year brings about numerous new cars which are sure to cost much more in comparison with the ones produced a year ago. It’s quite natural that a sum spent on the repair of such new cars would be also bigger. The research held in 2004 by the Insurance Information Institute III claims that auto insurance cost rise in that year reached only 3.5 %, which is a record low figure in comparison with the previous 4 years. This can be put to a number of factors: car producers pay more attention at the safety features of a car, drivers are becoming better, the number of car accidents reduces, due to special laws there is less fraud etc. But there is another side of the medal: in some states such as Massachusetts, New York and Florida the number of car thefts and fraud has increased which also couldn’t but have influenced the rise in the car insurance cost.
By the way in 2003 the increase in the cost was about 7.8%. In 2004 auto insurance cost was in average 871$, which is 29$ more expensive than in 2003. In order to cut down on the Insurance Premiums Increase, the majority of the insured drivers prefer to make insurance claims only in case of serious damage, the repair cost of which is sure to cover premium rise. The increasing number of car crashes also affects badly the insurance business. A lot of specialists put this to the numerous accidents happening to sport utility vehicles.One more reason for the rise in the insurance premiums is the great number of medical claims. This year there have already been 20 billion medical claims made. So this category of claims comes very expensive to the insurance companies and they try to compensate their expenses including medication and hospitalization with the help of premium cost rise.Though no one can tell for sure what the concrete reasons for the premium rise are, usually it can be put to your buying a new car or changing the place of living. Anyway we hope that this article would help to find the most suitable auto insurance plan and save some money.
