Criminal activities in your neighborhood can affect your auto insurance rates. Below are some of the crimes that can affect your rates, and how to mitigate the effect.
The Major Crimes
Many types of crimes can affect auto insurance rates, but the following are the ones to worry about the most.
If you have comprehensive coverage and your car gets stolen, your auto insurance carrier may compensate you. Some areas experience more car thefts than others. Insurance companies that operate in such areas pay more comprehensive claims than others. Those insurance companies have to raise their rates to take care of the numerous comprehensive claims.
Insurance fraud causes billions of dollars in losses every year. Auto insurance fraud comes in various forms. For example, some people:
- Lie on the primary driver designation
- Dump their cars and submit car theft claims
- Exaggerate damages when filing auto insurance claims
Auto insurance fraud also varies by region. Again, insurance companies servicing areas with high rates of fraud lose millions of dollars and must take measures to reduce their exposure to the losses. One of these measures is to increase rates for all motorists in areas with high incidents of fraud. Make sure you're 100% honest with your insurance company and whenever you file a claim.
Some people don't consider traffic crimes as serious crimes. This is unfortunate because traffic crimes are dangerous in many ways. First, traffic crimes increase the risk of accidents. For example, ignoring traffic lights increases the risk of hitting other road users.
Secondly, traffic crimes increase auto insurance rates. Therefore, if motorists in your area commit numerous traffic crimes, expect the auto insurance companies to take note and increase rates for the area.
What You Can Do
Ideally, you should move to a low-crime area to limit the effect of crime on your rates. Unfortunately, this is not always possible. Still, you can take the following measures to manage your coverage rates.
The auto insurance industry has numerous discounts to motorists. Many people have not taken advantage of all the discounts they can enjoy. Talk to your insurance agent to help you get every single discount for which you qualify.
Most of the factors that affect auto insurance rates, including crime statistics, are not static — they change all the time. Shop for auto insurance regularly to ensure you are not paying more than you should at any time.
To learn more about auto insurance, contact an agent near you.Share