Dang it! My Car Insurance is Going Up

Remember last summer wehn I wrote about how my insurance agent set me up with a new auto insurance policy and that by doing so, I was going to save $800 per year? If not, you can read about it here. The only difference that I could tell between the new policy and my old policy was that the new one was a 6-month policy while the old policy was for one year.

I got my renewal in the mail this week. It looks like I’m going to have to give back some of that savings.

The renewal premium is $731, which is $84 more than my policy from 6 months ago. It doesn’t seem like that much of an increase but if they do this to me every six months, I ain’t gonna be happy! If I annualize the new premium, it makes premium $1,462 per year, which is still a lot cheaper than the old policy.

I asked the agent about this and she said that Travelers raised their rates and that my renewal reflected that. Now I know why the insurance company went with a 6-month policy! Every six months they have an opportunity to raise rates.

18 thoughts on “Dang it! My Car Insurance is Going Up”

  1. I see this a lot. Though they never admit it, it seems that the first rate is a teaser rate. Then the next period it adjusts to the real rate. Always saying “corporate raised rates”

    Try this.

    Call an agent of the same company. Pretend you are not a customer and go through the process of getting a rate.

    I’ll bet you its lower. Then you got them.

  2. What state are you in? Most states require some sort of adverse action notice that would outline WHY you’re getting such a substancial increase.

    That’s about a 13% increase, which would be pretty steep. Insurers are not allowed to ‘just increase rates’; increases have to be approved by the state regulators and would apply to everyone covered by Travelers. The P&C industry as a whole is very profitable and experiencing what we call a ‘soft market’: profits are driving insurers to lower rates to increase business.

    I’d call your agent again and make sure you’re getting all the discounts you’re supposed to be getting. They may have dropped an auto-home discount or rated something incorrectly resulting in a premium increase (then blame the company, NICE).

  3. Have you considered Geico? Not to sound like a commercial but I LOVE them. Every year since Ive been with them my rates have gone down. I started out in 2004 with a 1999 car at $120/month and now I pay $58/month! I don’t know about your credit or accident history but if you haven’t checked them out then it’ll be worth a try.

  4. one more thing.

    They now can review your credit report. In order to offer you a good rate, they may choose to not pull it till after your first term, then insist that you never should have had the higher rate to begin with.

    But I agree with the above, they probably have to eventually send the cause.

  5. If you are a member of AAA, they’ll do a free rate quote for you, cross checking between several companies and let you know what your best options are. In the past, they’ve even been doing promotions for gas cards and that sort of thing for using the service, though I don’t know if that’s going on now or not.

  6. FMF —

    I’ll second the above person. I’ve had quite decent luck with Geico keeping my insurance at a steady level. I pay in two installments of $194 to cover 6 months (so mine totals $388 for 6 months). My payment has raised and dipped by a few dollars but it’s kept at right under $200 for years. And I’ve noticed that they add a fee of $4 since I pay in two payments, but they always send me a check for $4 after I pay on time.

    I’d pay in full each time except they handled the paperwork kind of screwy for that the time I did it, and so I went with their next option to pay in 2 installments.

    P.S. – this is on a 2002 Ford Focus and I drive in a major city, by way of comparison.

  7. To add to the voices supporting GEICO, (about whom I have no complaints from my years with them), we have also enjoyed the service and low rates with Liberty Mutual insurance. I would second the motion of the first poster to check out what the company’s introductory rates are, and that could lead you to a drop again! I hope so, nobody needs a raise like that every six months…

  8. It makes me so angry that some insurance companies do this to people. I wish they couldn’t lowball quotes and then raise the prices unless you got a ticket or had an accident that was your fault. It’s crazy they are allowed to do that!

  9. Thanks for all the responses.

    I’m not saying that Travelers or my agent did anything wrong but I will say that in the back of my mind I was wondering about the 6-month renewal.

    I’m curious to see what happens when we renew in 6 more months.

  10. I have been a long time travlers customer and recently they ripped me off. My cost went from 167.00 a month for 2 cars full coverage with 500 deductibles, to over 220.00 a month. I called they were able to “get me a better rate” of 200.00 a month, thats still more than i paid to start with! What a scam, they lost a perfect paying long time customer. The service was great i don’t now what happened to them *disappointed* im switching to geico, they offered at lowest 131.00 a month, for almost the same coverage.

  11. I am an independent insurance agent and I can tell you that rates just change..thats the nature of the business and I see as many rates fall as I do rise…if you are truly concerned about the rate hikes, the best thing to do is shop everytime your rates go up…and when I say shop, I mean put in your due diligence…spend a night with online quotes, call some independent agents, call direct agents…everytime my rate has gone up, I shop and typically wonder why I don’t do it every renewal period because I end up saving so much.

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  13. I have esurance. I used to have them for awhile. Every six months they would raise my rate substantially. Then I would call to ask why, the CSR would look at something then say this blah blah blah is rated wrong then give me a new rate that was between the higher rate and my previous rate but still higher than my previous rate. I eventually got frustrated and left to go to 21st century. Pretty much same thing happened, except when I called about my rate increase they had no answer for me and did not do that in between thing.

    I’ve decided that all car insurance is a giant ponzi scheme. I haven’t had any driving violations or anything for over 5 years. The only thing I did have was a girl rear ended me and ripped off my bumper, but her insurance paid it. BTW, Her insurance was Geico. They made it super easy for the claim and took care of everything very quickly, even though I’m in PA and it’s a no fault state and they were required to do anything, they could have made me go through my insurance company first.

  14. The initiative taken for the concern is very serious and need an attention of every one. This is the concern which exists in the society and needs to be eliminated from the society as soon as possible.

  15. i work in a call center in El salvador for a car insurance and i´m really concern for that absurd situation of increasing the rates due to “state rate revison” every now and then. I have script saying that its due to: price in labor, the index increase in claims, parts, risk due to territory, and so on. if those are the main reasons a think they have the right to increased the rates, but my question is who can tell me that is true??? does the state have the prices of all the above so I can look at it..well i dont live there but why I dont see anyone fighting for your rights in that country or are you people are so “tontos” or are you afraid of the mafias. blessings.

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