Why Your MA Car Insurance Just Increased (Hint: it Might Have to do with Old Driving Incidents)

So, your car insurance policy just renewed and something seems a little off … your premium is a lot higher than it was last year.

Nothing has changed on your policy, so why should you be paying more?

At Berry Insurance, we get your frustration. Nobody wants to be paying more for a service they used to pay less for, but unfortunately, that’s sometimes how insurance works for us all. 

Small increases are usually normal. Many external factors cause rates to inflate annually, but if the increase is significant, there might be other factors playing into it. 

More than ever, auto insurance rates are increasing, and for many, the reason they’ve increased might surprise you.

Out-of-state violations are just being processed

Last summer, a review by transportation officials revealed that the Massachusetts RMV failed to process thousands of out-of-state driving violations. These violations mailed to MA from other states quite literally piled up, sitting in over 50 boxes at an RMV office.

Since then, the RMV has been working to correct the backlog and as a result, Massachusetts drivers are just starting to see the consequences of an out-of-state violation that may have occurred years ago.

When drivers commit an offense in another state, Massachusetts penalizes them as if they had committed the offense in Massachusetts. 

As a result, drivers who were cited in other states may be noticing their policies increase by hundreds of dollars, depending on the offense. Others are having their licenses revoked altogether for more severe offenses.

Could you be affected?

It appears the RMV workers stopped processing the violations in March 2018, so if you had an out-of-state violation after that time and weren’t penalized immediately, you may be seeing your insurance rising once it’s renewed (or occasionally mid-term if the carrier receives a re-inquiry request from RMV).

Didn’t have an out-of-state violation?

If it doesn’t seem like the above situation pertains to you, your car insurance cost increase probably had a different cause.

For more information, check out this article Why Do My Car Insurance Rates Keep Going Up? We’ll also summarize some potential causes below.

Life changes: 

Some life changes, such as moving or adding/removing drivers from your policy can affect the price of your car insurance in either direction.

Lost Discounts:

Many insurance companies offer safe driver discounts, loyalty discounts, multi-vehicle discounts, multi-policy discounts, and more. If you were once eligible for those discounts, and now are not, you’ll likely experience an increase in your car insurance rates. 

Changing payment plan:

Paying in full, or using ACH or EFT to pay for car insurance can save you money on monthly billing fees. But if you remove that payment method, you will definitely see an increase in your monthly bill.

More technology:

Cars are more advanced today. And that technology continues to expand every year. 

Things like cameras, safety sensors, keyless start and bluetooth help make our lives easier. But they also make auto repair costs higher. To replace a bumper used to cost a few hundred dollars. Today, with backup cameras and sensors, it can easily cost thousands. 

Even something simple like a windshield replacement costs more due to higher quality glass. 

To offset the increase in repair costs, the insurance companies raise rates to try and recoup some of their extra expenses.

More accidents/claims:

It’s an ugly truth, but unfortunately, car accidents are on the rise. 

Whether it is because there are more people driving, or there are more distractions, with more claims for injuries or damage than ever, car insurance companies have to raise costs to offset the money they are paying out  on claims.

Rising medical costs:

As medical costs rise, the costs paid by insurance companies for claim injuries rise also. To help absorb some of these increases, insurance companies will raise auto insurance rates.

What should I do if my auto insurance rate increased? 

If you were impacted by an out-of-state driving incident, fortunately those violations will drop off your policy and the price will decrease again.

In Massachusetts, violations drop off your record in 6 years after the date it is surcharged on your policy.

Aside from that, there are several other ways to save on car insurance. 

Bundle policies

Many insurance companies offer incentives for the more business you provide them. By bundling your car insurance with other policies (such as homeowners/rental) within the same insurance company, you may be able to save approximately 5-25 % on your policies.

Insure more than one car with the same policy or carrier (multi-car discount)

Similar to bundling policies, you can also earn discounts for insuring more than one vehicle in the same household. 

Pay via EFT/ACH or pay ahead

Paying for your auto insurance through electronic funds transfer (EFT), automated clearing house (ACH), or paying the premium up front can eliminate billing fees.

If you’re comfortable with your payment automatically withdrawing from your bank account each month, or if you can afford to front the premium, these methods can save you both time and money.

Choose a higher deductible plan

Of course, you can also lower your premium by selecting an auto insurance plan with a higher deductible. 

Doing this means you’ll be paying less per month, but will have to pay more if you get in an accident, so if you select a higher-deductible plan, you’ll want to make sure you have enough money set aside in case you need to cover damages from an accident.

Ask your agent about any discounts

You can get a discount for doing the following:

• Being a member of an association (such as AAA, AARP, alumni associations, wholesale clubs, military organizations, honor societies, and more)
• Giving to a charity 
• Getting good grades (insurance companies reward both high school and college drivers for earning good grades)
• Being a safe driver (drivers without accidents or violations for a certain period – usually five years – can save hundreds on their insurance through a safe driver or good driver discount)

Ask your agent if you are eligible for any discounts that aren’t already applied to your policy.

Remove Optional Coverages

Many insurance plans include optional coverages intended to provide services in specific scenarios. If these coverages do not apply to you, or if you have another service that provides similar coverage, you should not be paying the extra amount for them.

Collision:

Collision insurance offers coverage to repair or replace your vehicle if it is damaged in an accident. If your vehicle is older and the value is low enough that you could afford to repair or replace it if it were damaged or destroyed, you may want to remove collision insurance. 

Keep in mind, if you are leasing your vehicle, or if it isn’t paid off, collision coverage is typically required.

Substitute Transportation: 

Substitute transportation insurance will pay for at least a portion of the cost of a rental vehicle if you need one due to a covered loss while it is being repaired or replaced (if you have collision insurance). 

If you have an alternative vehicle you can use, or if you are able to go without your car for a period of time, you could remove substitute transportation.

Roadside/towing:

Many insurance companies offer roadside assistance or towing insurance if your car breaks down on the side of the road and you are unable to get it to a mechanic. If you have both roadside/towing and AAA, you are essentially paying for the same coverage twice, so choose one or the other.

Enroll in telematics

Through the use of technology, insurance companies are using tracking devices to monitor driver data including speed, mileage, driving time, hard brakes, and more to determine if you are eligible for a discount.

Pay-as-you-drive insurance models using telematics, such as Drive with Safety or N&Drive through Norfolk & Dedham, monitor driving habits to offer discounts up to 30% to cautious or low-mileage drivers. 

Telematics can not increase your premium. At worst, your premium will stay the same, but you could get a discount.

Understanding your car insurance costs

We know you probably aren’t excited to pay your car insurance bill every month, especially if it is higher than you expected it to be.

Unfortunately, auto insurance is just one of those things you don’t want to buy, but are required to have.

Whether an out-of-state driving incident just caught up to you, you had a life change, or outside factors impacted you, you can’t control your rising insurance costs, but there are some things you can do to manage it.

If you aren’t familiar with insurance in general, it might be difficult to know if you are paying a fair price for car insurance. Check out this article to dive deeper into what car insurance costs.