It was time to renew your car insurance policy, and the agency informed you that your premiums would cost more than earlier. You might be wondering when did that happen and how often your car insurance rate will increase in the future. The experts indicate that it is impossible to determine how often the cost of premiums will change. However, you can consider numerous factors to discover when to identify rate adjustments.
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Why Did My Car Insurance Rate Go Up?
If you are wondering why you need to pay more for your policy than last year, these are the most common reasons.
You Lost Your No Claim Discount
That is the primary and most frequent reason why your car insurance in Malaysia might increase. Before we discuss how you can lose the No Claim Discount (NCD), let’s explain it briefly. NCD is a discount that you get when renewing your insurance deal for multiple years. The lowered price can go from 25% (second year) to 55% (after the fifth year). As you can see, that is a considerable difference. If you lose it, the odds are that you will have to pay a lot more for your insurance. Here are the two main reasons why you would lose the No Claim Discount:
- You filed a claim – if you filed an insurance claim during the last year, cancel the discount automatically. That is why many people avoid filing claims when the damage costs are low.
- Someone else filed it against your policy – it might be that a third-party filed a claim against your current deal.
You Were Involved In A Collision
If you were a part of an accident, and you were the one to blame for causing it, your premiums might increase. That is because the insurance providers will see you as a bigger risk than before. Every agency will check your violation history carefully. Apart from accidents, they will also consider driving under the influence (DUI) or other violations.
Canceling A Policy Related To Car Insurance
Are your associated policies still active? If you cancel the homeowner’s policy, the odds are that your car insurance premium with the same provider will rise. There is another reason why your car insurance cost might be higher than usual. You might have changed the provider, and it is your first year with the news agency.
Other Reasons Why Car Insurance Rates Might Go Up
Your car insurance policy’s cost might increase for reasons that don’t have anything to do with you. Here is an overview of other factors that affect the rates:
- An increased number of accidents – the agencies might decide to change the rates because the overall number of incidents has gone up in recent years. That happens because of distracted drivers talking on smartphones, typing messages, etc.
- More expensive to repair the car – the cost of repairs might change, especially with new safety features and car components.
- Pricier healthcare – the healthcare cost might also go up, including medical treatments and therapy. That is why the agencies might be forced to alter the rates.
If you move to an area with a higher flood risk or another factor the company considers relevant to your car insurance policy, that could also be the reason for a higher premium rate.