The 5 Most Costly Situations That Affect Car Insurance Premiums

Expensive situations that affect your car insurance premiums include accidents, coverage type, and speeding tickets or other traffic violations.
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While you can easily find the right car insurance to meet your needs, keeping your premiums down is sometimes more challenging. Even though you can’t control your age, gender, or previous accidents on your record, you can become more aware of the most costly premium-raising situations going forward.
Find out more about the five most costly situations that affect your car insurance premiums:

Situation 1 of 5: At-fault accidents affect car insurance premiums

At-fault accidents represent one of the biggest factors that cause car insurance premiums to go up. Worse yet, the more accidents on your record, the higher your premiums. Too many accidents can also cause a car insurance company to decide not to renew your policy.
Taking a defensive driving course represents a great way to reduce an insurance premium hike following an accident. Keep in mind that the laws governing such classes vary by state, with some restricting who can take advantage of such courses according to age. DMV.org provides a list of regulations for each state and who qualifies for a defensive driving course discount with their car insurance company.

Situation 2 of 5: Where you live can increase car insurance costs

Your home address plays a part in determining your car insurance premiums. Areas that see greater instances of theft and vandalism cost drivers more in insurance premiums compared to living in safer parts of a city or state. Also, high traffic areas carry higher premiums since the likelihood of getting into an accident increases with the greater number of cars on the road.
The number of uninsured drivers in an area can also cause your insurance premiums to go up. The following chart from Insure.com shows the difference in car insurance premiums between each U.S. state.
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Annual Car Insurance Premium Averages By State
Rank State Premium
1 Michigan $2,738
2 Montana $2,297
3 New Jersey $1,905
4 Louisiana $1,842
5 Oklahoma $1,778
6 Washington, D.C. $1,773
7 California $1,752
8 Florida $1,654
9 Maryland $1,610
10 Rhode Island $1,608
11 Delaware $1,607
12 Georgia $1,559
13 Texas $1,510
14 West Virginia $1,456
15 Wyoming $1,421
16 Colorado $1,393
17 Connecticut $1,367
18 South Carolina $1,353
19 Arkansas $1,345
20 Alabama $1,337
21 Massachusetts $1,325
22 Pennsylvania $1,305
23 Kentucky $1,295
24 New Mexico $1,277
25 Mississippi $1,277
26 Oregon $1,267
27 Minnesota $1,257
28 Nevada $1,221
29 North Dakota $1,188
30 Nebraska $1,188
31 Arizona $1,188
32 South Dakota $1,168
33 Washington $1,168
34 Tennessee $1,145
35 Kansas $1,135
36 Indiana $1,113
37 Alaska $1,078
38 Utah $1,061
39 Missouri $1,056
40 New York $1,050
41 Hawaii $1,049
42 Illinois $1,035
43 Virginia $1,020
44 Iowa $989
45 North Carolina $987
46 Vermont $942
47 New Hampshire $941
48 Idaho $935
49 Wisconsin $912
50 Ohio $900
51 Maine $808
National Average $1,325

Situation 3 of 5: Adding a teen to your car insurance policy can be expensive

Adding a young driver, between the ages of 16 and 24, to your car insurance policy will more than likely cause it to go up. You must list any licensed driver in your home who does not have their own insurance on your policy. Not doing so can result in a denied claim or cancelled policy if they have an accident while driving your vehicle. The following table from ValuePenguin shows the average car insurance quote by age across the U.S.
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Average Car Premium Cost By Age Across the U.S.
Age Average Cost Per Year
16
$8,226
18 $6,456
21 $3,620
25 $2,374
30 $2,078
35 $2,028
40 $1,973
45 $1,929
50 $1,855
55 $1,845
60 $1,867
65 $1,956
70 $2,131

Situation 4 of 5: Better insurance coverage raises your insurance premium

Opting for higher coverage subsequently drives your car insurance premium costs up. Your deductible amount - which is the amount you must pay in the event of an accident before your car insurance kicks in - also plays a part in the final cost of your premium. The following table from ValuePenguin shows the minimum car insurance coverage requirements by state.
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Liability Coverage Requirements by State
State Body Injury Liability per Person / Bodily Injury Liability per Accident / Property Damage Coverage Requirements
Alabama $25,000 / 50,000 / 25,000
Alaska $50,000 / 100,000 / 25,000
Arizona $15,000 / 30,000 / 10,000
Arkansas $25,000 / 50,000 / 25,000
California $15,000 / 30,000 / 5,000
Colorado $25,000 / 40,000 / 10,000
Connecticut $20,000 / 40,000 / 10,000
Delaware $15,000 / 30,000 / 10,000
District of Columbia $25,000 / 50,000 / 10,000
Florida $10,000 / 20,000 / 10,000
Georgia $25,000 / 50,000 / 25,000
Hawaii $20,000 / 40,000 / 10,000
Idaho $25,000 / 50,000 / 15,000
Illinois $20,000 / 40,000 / 15,000
Indiana $25,000 / 50,000 / 10,000
Iowa $20,000 / 40,000 / 15,000
Kansas $25,000 / 50,000 / 10,000
Kentucky $25,000 / 50,000 / 10,000
Louisiana $15,000 / 30,000 / 25,000
Maine $15,000 / 30,000 / 10,000
Maryland $30,000 / 60,000 / 15,000
Massachusetts $30,000 / 60,000 / 15,000
Michigan $20,000 / 40,000 / 10,000
Minnesota $20,000 / 40,000 / 10,000
Mississippi $25,000 / 50,000 / 25,000
Missouri $25,000 / 50,000 / 10,000
Montana $25,000 / 50,000 / 10,000
Nebraska $25,000 / 50,000 / 25,000
Nevada $15,000 / 30,000 / 5,000
New Hampshire $25,000 / 50,000 / 25,000
New Jersey $15,000 / 30,000 / 5,000
New Mexico $25,000 / 50,000 / 10,000
New York $25,000 / 50,000 / 10,000
North Carolina $30,000 / 60,000 / 25,000
North Dakota $25,000 / 50,000 / 25,000
Ohio $12,500 / 25,000 / 7,500
Oklahoma $25,000 / 50,000 / 25,000
Oregon $25,000 / 50,000 / 20,000
Pennsylvania $15,000 / 30,000 / 5,000
Rhode Island $25,000 / 50,000 / 25,000
South Carolina $25,000 / 50,000 / 25,000
South Dakota $25,000 / 50,000 / 25,000
Tennessee $25,000 / 50,000 / 15,000
Texas $30,000 / 60,000 / 25,000
Utah $25,000 / 65,000 / 15,000
Vermont $25,000 / 50,000 / 10,000
Virginia $25,000 / 50,000 / 20,000
Washington $25,000 / 50,000 / 10,000
West Virginia $25,000 / 50,000 / 25,000
Wisconsin $25,000 / 50,000 / 10,000
Wyoming $25,000 / 50,000 / 20,000

Situation 5 of 5: Speeding tickets and other traffic violations raise insurance rates

Speeding tickets and other traffic violations can identify you as a risky driver. According to Insure.com, minor violations such as speeding tickets raises your premiums by 20 to 40 percent, or at the very least cost you your good driver discount.
More harmful violations, such as a DUI, can cause your premiums to go up by 100 percent or more. The following table, from Neckerman.com shows how various moving violations negatively affect your car insurance premiums.
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Average Premium Increases for Moving Violations in the U.S.
Moving Violation Average Percent Increase
DUI/DWI 92.49%
Reckless driving 83.29%
Speeding 31 + MPH over the limit 29.26%
Speeding 16 to 30 MPH over the limit 28.06%
Careless driving 26.62%
Driving the wrong way 21.34%
Speeding 1 to 15 MPH over the limit 20.54%
Improper passing 20.30%
Following too close 18.86%
Failure to stop 18.94%
Not yielding to a pedestrian 18.78%
Failure to yield 18.71%
Not signaling 18.55%
Violating railroad rules 18.07%
Driving in the carpool lane 17.91%
Driving without a license 16.47%
Not wearing a seat belt 5.60%
Car insurance represents something you need if you want to drive a vehicle in the U.S. Coverage requirements vary according to where you live, your driving record, your age, and other factors. Understanding what can affect you car insurance premiums allows you to make decisions to keep your premiums low, including seeking more cost-effective insurance from another company. Allow Jerry to help you find the best insurance company that can meet all of your needs.

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