How does Car Theft Affect Insurance Premiums – Insurance Rates Go up?

By | September 28, 2018

Will Your Car Insurance Rates be affected by Auto Theft?

If your question is like; my car has been stolen will my insurance go up? Then let’s discuss all factors about ‘how does car theft affect insurance premiums?’ Your car is a necessity for you as well as it is very valuable too. You purchase it with your hard earned money and you always feel that it should be in good condition and doesn’t get damaged or lost for any reasons. You need to have an insurance that can protect you if any accident or damages or loss occur to it. It pays for damages to the car, property or bodily injury to you or others provided you have an appropriate coverage.

How does Car Theft Affect Insurance Premiums

In most of the States, it is mandatory that you have minimal coverage for your vehicle. The coverage’s offered are liability coverage, bodily injury coverage, comprehensive coverage etc. All the coverage are not included in the standard insurance policy, you have to take additional coverage along with basic policy.

Auto theft is quite common in the United States, United Kingdom, Canada or any other country. It is not that wealthy people with brand new car needs to worry about auto theft, old cars are also at equal risk. Some of the areas have high crime rate, whereas others have less. No matter where you live, there is always some risk for auto theft. So, let’s check more details on ‘Will Your Auto Insurance Rates Be Affected by Auto Theft?’ You have to consider insuring your vehicle against theft. You need to have comprehensive coverage for protection against theft. Insurance against auto theft will affect your auto insurance premium considerably.

Auto Insurance and Factors Affecting Premium

Auto Insurance

There are many factors that affect your auto insurance premium in many different ways. Some of the factors that have significant impact on deciding premium are discussed below.

Where you live: It is one of the important factors as insurance premium depends upon crime rate of your location. If the area where you live has a high rate of vehicle theft, it will increase your premium rate.

Credit Score: When determining your premium rate, most insurance companies take your credit score intoaccount. There is no specific limit to the credit score, but usually less the credit score, more is the premium.

Credit Score

 

Profession: Many insurance companies correlate between your profession and accident risk. It is assumed that professional who have to travel a lot and are on the road for a loner time, for example, delivery drivers, journalists etc. are at more risk.

Gender and Age: The studies reveal that young men incur more accidents to young women, whereas old men have less accident rate than old women. Insurance premium rate are affected by gender and age though it doesn’t have much impact.

Vehicle Size: It is observed that larger vehicle is safer compare to small vehicles. However, cars with larger engines relative to the size of the car have higher rates.

Marital Status: Various surveys performed shows that married people make less accidents compare to single people. Your marital status does affect your insurance premium.

Safety Rating: Vehicles with higher safety ratings are less prone to accidents and as such for these vehicles insurance premium is somewhat less.

Personal Driving Habits: If you have received tickets or have made a claim earlier, it proves that you are more likely to meet accidents. It tends to increase your premium. If your driving record is bad, you might not get insurance at all.

How Auto Insurance Is Related to Auto Theft

Auto Theft

One of the important factors in determining auto insurance premium is crime rate in your area. If the area where you live is highly prone to auto theft, your insurance provider will use the risk statistics and increase your insurance rate. As per the survey made by FBI, auto theft is no.1 crime in the U.S. with a record of one vehicle being stolen every 44 seconds with California State having the highest crime rate. You will have to pay more premiums if you living in an area with high auto theft crime or the vehicle you are getting insured is listed as one of the most commonly stolen vehicle.

If you are living in one such high crime rate area and wants get your car protected from vehicle theft, you get auto insurance with comprehensive coverage. Comprehensive coverage pays for your vehicle in case of auto theft or even parts of it get stolen.

When it comes to auto theft coverage, some insurance policies cover only the depreciated value of a stolen car rather than the replacement cost. Moreover, if you have an insurance policy that offers minimal coverage for theft, probably you won’t get paid for the car rental while your claim is being processed. You have to discuss and understand all the levels of protection with insurance agent when you buy insurance for your auto. You also study your policy information packet carefully to make sure you understand all the details regarding coverage.

However other factors such as gender, age, driving history, locations, credit score, previous claims, lapses in coverage etc. also affect your premium, it is difficult to predict exactly what premium you will have to pay.

The best way to make sure that you are offered a fair rate for your coverage is to obtain quotes from several different insurance providers.

Some Other Factors That Helps Reducing Insurance Premium

If you are to purchase a car, go for one that has low theft rate. If you have already a vehicle, you get quote from different companies and compare for the best possible benefits. Many insurance companies offer additional discounts if you purchase an auto insurance as a part of a bundle with your other insurances or as a member of fraternal group association.

If you get anti-theft auto protection devices installed in your car, you might be offered some discount and it will lower your premium.

To conclude, if you own a car, you have to consider protecting it against theft. As auto theft rates are increasing in the U.S., UK, and Canada or in your country it is recommended that you insure your auto with comprehensive coverage. You cover it from a reliable provider and enjoy your car ride without being worried!

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