If you’ve received that dreaded email…” Dear Customer, this is your policy update…” you know what’s coming. It’s almost always your insurance premium increasing.
We have seen some insurance companies taking a bit of a chance or making mistakes with their consumers policy’s and increasing premiums more than 30%. If you see this, it’s not normal and we suggest that you contact your insurer and firstly ask why your insurance premium has increased by such a large amount. They may have a good reason depending on your circumstance but sometimes they have simply made a mistake. You don’t want to be paying for their mistake for the whole year.
How much is an acceptable annual insurance increase?
As with everything in insurance there isn’t a simple answer here. This is due to the fact that every individual has different risk factors and we are all judged by how we have claimed from the insurer, if we have moved or even if we have painted our car a different colour. This can all impact the price you will pay for your insurance.
Let’s say you have not claimed, nothing at all has changed with your car or your personal life, insurers find acceptable yearly increases to be between 8% and 15%. Premiums should generally increase aligned with inflation.
Want to do an online car insurance comparison to compare what you are paying to what you can be paying with some other car insurance companies?
“Within the industry increases will vary from Insurer to Insurer, based on individual client criteria, having had claims or not, credit check variances (if their score improved or not), but normally between 8% – 15%, however in all cases if client does not agree with increase they should contact their Insurer.” – Juan Manuel V-Plus Brokerage
Why Insurance Premiums Increase Every Year?
There are many factors that cause an insured’s insurance premium to increase every year from factors that are out of your control to changes in your personal life and changes of your car.
Some of the most common reasons why car insurance increases every year is due to inflation, increased cars on the road, increased cost of labour and repairs, increased claims (yours or in general, yes other people’s claims will eventually affect you) change of employment and more.
Steps to take if you feel like you your insurance premium increase is excessive: click here.