How to combat rising auto insurance rates

Auto insurance rates are going up again this year. Many are asking: How can we help bring them down?

Kevin Brasler of Puget Sound Consumers’ Checkbook says one way is to keep it competitive.

“A big mistake drivers make is they stick with the same insurance company year after year. Sometimes they do that because they think, well, all insurance companies, they charge about the same rates and they absolutely do not.”

Kevin has studied prices from around the region. “Insurance companies, especially auto insurance companies, charge drastically different rates for the exact same policy, the same policyholders, the same cars. There just huge price differences. And the only way you can determine which company is going to charge you a low rate is to do some shopping around.”

In its survey, Kevin used full coverage with a thousand-dollar deductible. For example, the report compared a couple with two cars living in Seattle with clean driving records. It found price differences from $1100 to $3,600.

In Pierce County a couple with two cars and a teenage driver the group found prices ranging from $1900 to more than $6400.

“These days it’s hard to account for these big differences in auto insurance prices. We’ve always seen them, but they’ve become more pronounced now that insurance companies are being allowed to use a lot of different factors that really have nothing to do with driver risk in setting their rates.”

One of those factors is credit scores. “Companies charge 2-3 times higher prices for those with low credit scores than they do those with high credit scores. Even though you know your credit score has nothing to do with your risk as a driver. The insurance companies see it as, oh, there’s a higher risk of you making a claim because you have a lower credit score.”

Another thing to remember starting in June of this year if you receive a premium increase, ask why.  Because of a new law, insurance companies must give you a reasonable explanation for it using terms they can understand. If you don’t like what you hear, take the info and shop around.

For more information go here.