This might be dumb but I haven't been able to find and answer. Why doesn't full coverage insurance go down in price every year if I have the same cars? The amount they are going to pay me if it's totaled goes down so why doesn't the price?
Full coverage insurance question
- Thread starter Drillbit
- Start date
Yes the risk to them does go down. If my car is worth 20k and I total it they owe me 20k. The next year that car is worth 16k so if I total it I get 16k.
I don't claim to know much about auto insurance and what affects rates, but I do have a health insurance license and understand that everything is based on risk. That "risk" is calculated from the obvious, and the not so obvious. I.E. if you're 23 years old and driving a Ferrari your rates will be more than if you were driving a Ford Ranger. The not so obvious would be shit like your credit score. Poor credit score means more risk to the insurance companies.
I agree with all that. Assuming someone goes from 35 to 36 and has a car that has gone down 4 grand in price why would the price not go down unless something else big changes?
No moving violations in the last 3-5 years? No accidents? No DUI's?
I'd start calling around for quotes.
FWIW, I deal with a local broker. Every so many years they shop our insurance for us. My check goes to the same place, but my insurance provider may change every-so-often. It changed twice in the last two years from Cincinnati to something to Grange.
Also helps to lump in everything with the same company for a discount, which I'm sure you know. Home, auto, commercial auto, business, general liability, umbrella, etc...
I'd start calling around for quotes.
FWIW, I deal with a local broker. Every so many years they shop our insurance for us. My check goes to the same place, but my insurance provider may change every-so-often. It changed twice in the last two years from Cincinnati to something to Grange.
Also helps to lump in everything with the same company for a discount, which I'm sure you know. Home, auto, commercial auto, business, general liability, umbrella, etc...
I don't have full coverage insurance. I can afford to replace my cars if I smash them so I save the $$$. I am asking out of curiosity. I don't remember my rates falling every year back when I did have it.
Another way to look at it is this...
If you're car is 3 years old, that means the brakes, tires etc are 3 years old (Maybe, Maybe not)...and the safety features are 3 years old compared to new safety features available in new cars...
hell, idk...I think that's just another look at it.
If you're car is 3 years old, that means the brakes, tires etc are 3 years old (Maybe, Maybe not)...and the safety features are 3 years old compared to new safety features available in new cars...
hell, idk...I think that's just another look at it.
First of all, most of your insurance bill is for liability and other things that are independent of your car's cash value. Now, when it comes to the cost for collision and comprehensive coverage, the company does not use a straight multiplier of cash value x xxx equals your rate. They classify cars by group, where the group is a combination of average cash value and risk.
For example, a late model Rolls Royce is very expensive but the likelihood of one being stolen is very low (almost zero) so the theft insurance on that car will be less than theft coverage on a Camaro or Mustang in many places.
In general, the risk of loss increases as cars get older (especially high end cars) so the insurance company often sees a 2006 Range Rover as essentially the same loss risk as a 2014. This varies with where you live but it's generally this way to some extent everywhere
For example, a late model Rolls Royce is very expensive but the likelihood of one being stolen is very low (almost zero) so the theft insurance on that car will be less than theft coverage on a Camaro or Mustang in many places.
In general, the risk of loss increases as cars get older (especially high end cars) so the insurance company often sees a 2006 Range Rover as essentially the same loss risk as a 2014. This varies with where you live but it's generally this way to some extent everywhere
I asked my insurance agent pretty much the same question. This my be an industry response, but he basically told me that it's not the vehicle replacement cost that they are worried about, but that the cost of a Bambulance, property damage replacement costs, and injury to other parties or you. Those costs have increased significantly over last 10 years.
True or not ??? I bit
True or not ??? I bit
