Why Did My Car Insurance Go Up?

Did you notice an increase in cost for your auto insurance policy? Perhaps you recently received a letter from your insurance company letting you know about future increases to your policy’s premium. In order to understand why your car insurance went up, it’s important to learn about the various factors that impact the cost of auto insurance. Some of these factors we can control, but other factors are beyond our control. It’s helpful to understand the many nuances so that you can make more informed decisions regarding your car insurance needs. If you need any help getting good auto insurance coverage at an affordable price in Arizona, contact James Grace Insurance today. Our team will answer all of your questions and do the hard work to make sure you have the best possible deal.

Does Car Insurance Go Up Every Year?

For many people, the answer to this question is yes. Car insurance often goes up, even if only a slight amount, each time the policy is renewed. This could be every six months or every year. Naturally, the next question you might ask is “why?”. Since there are various factors that impact the cost of car insurance, it’s helpful to break it down into two categories:

Individual Risk Factors
Increase in Car Insurance Company’s Expenses

Individual Risk Factors for Car Insurance

Individual risk factors refer to your personal driving record or change in insurance needs (or someone else that is on your auto insurance policy). Examples of individual risk factors include:

Filed a new claim
Traffic violation on record
Add a new vehicle to the policy
Update the policy to change your vehicle
Add a new driver to the policy
Change drivers on the policy
Age of drivers on the policy
Increasing the amount of coverage

Technically, you have some control over these factors in that they depend on what you do or don’t do. Of course, with multiple drivers on the policy, you might not be able to control whether or not another driver gets in an accident and files a claim, however they remain your responsibility since they’re on your policy.

With the exception of minor claims (less than $1,000) and minor traffic violations, all of the reasons listed above add more risk in the eyes of the insurance company providing coverage. As a result, the cost of your auto insurance premium is likely to increase if any of these factors come into play.

Increase in Car Insurance Company’s Expenses

There are other reasons the cost of auto insurance might go up for you that have nothing to do with what you do or don’t do. These include:

Expiring discounts – Some of the discounts you initially received when starting your auto insurance policy might decrease over time and eventually disappear or simply expire after your first policy term. If that happens, then the cost of your insurance will naturally increase.
Insurance rates change – An insurance company might increase their premiums if they find that their rate levels are too low compared to their expenses from recent claims. If the insurance company is suffering losses because their rates are too low, then they will need to remedy that with an overall increase in auto insurance premiums.

How Much Do Individual Risk Factors Matter?

You might be wondering how much control you have in the cost of your auto insurance and how the insurance companies weigh individual risk factors in their cost-benefit analysis. Insurance companies might vary in their approach to these risk factors, but in general, all insurance companies will re-evaluate policies before renewal. In some cases, they might increase costs due to an increase in risk factors. Other times, they’ll decrease costs due to a decrease in risk factors (such as a clean driving record or removal of a driver from the policy).

No matter what, you should work with a car insurance company that is known for being fair when evaluating individual risk factors and the overall cost of auto insurance.

Contact James Grace Insurance for Your Auto Insurance Needs

Looking to start or change your auto insurance policy? Make sure you work with an insurance company that you trust. James Grace Insurance, an independent insurance agency based in Scottsdale, AZ, has you covered. Our experienced team will shop around for the best coverage at the most affordable price so you don’t have to. We’ll do the shopping so that you can do the saving. You have nothing to lose and everything to gain. Contact us today to get started!

Type of Insurance You Should Get When Buying a New Car

How to Get Insurance for a New Car

You can’t get a new insurance policy before purchasing a new car because you need specific information related to the car to get the insurance. You should to know at least the following three things before getting an auto insurance policy:

- Vehicle Identification Number (VIN) – You can’t purchase a car insurance policy without the car’s VIN number.
- Car’s purpose – Depending on how you plan to use the car, whether it’s for personal use or business use, you might need to purchase additional insurance coverage.
- Other regular drivers – If other drivers in your family will use the car on a regular basis, then you will need to add them to your car insurance policy.

While you can’t purchase new car insurance before actually getting a new car, you can start shopping around to collect a few different insurance quotes. That way you can have an idea of what the car insurance will cost you based on the types of cars you are looking at. Once you buy the car, you can call the insurance company with the VIN number and officially purchase the insurance.

Buying car insurance is typically very easy. You can most likely do it on your smartphone while you are at the dealership after you’ve signed the paperwork. If you wait until you get home, one phone call to the insurance provider should get the job done.

Is There a Grace Period When Insuring a New Car?

It’s important to know that the dealership’s car insurance does not cover you once you’ve purchased the car and left the lot. Their insurance is only meant to cover test drives.

However, most insurance companies do offer a grace period for people who purchase a new car. This means that your current auto insurance policy might cover you for a short period of time (likely between 7-30 days depending on the insurance company) after you have purchased a new car. This gives you time to update your auto insurance policy after buying a new car. If you are planning to get a new car, you should remember to do two things:

Check with your insurance provider about their grace period – If your insurance company does offer a grace period, you should bring whatever is needed to the dealer to prove that you are eligible for this temporary insurance coverage.
Don’t forget to update your policy – Make sure you update your policy before your grace period ends! Having a lapse in insurance coverage can negatively impact your insurance rates in the future.

Are New Cars More Expensive to Insure?

The answer to this question depends on how you look at it. In general, newer cars are probably more expensive to insure, but it is not always significant. On one hand, you might want to carry comprehensive and collision insurance if you have a newer car, which means a more expensive insurance policy. On the other hand, newer cars often have additional safety features (lane assist, back-up cameras, blind-spot cameras, etc.). These safety features make the car safer to drive, which can mean a lower cost of insurance.

What Type of New Car is the Most Affordable to Insure?

There are various factors that impact insurance costs, but in general, the cars with fewer and less costly insurance claims come with less expensive insurance. For example, since a Honda CR-V 4dr/4WD is more likely to end up with a bodily injury claim than a Ford Expedition 4dr + 4WD, it is likely that the Ford will be cheaper to insure. If you are looking to buy a particular car, it might help to look up the car’s overall accident statistics and safety ratings to have a better idea on potential insurance costs. Again, there are other variables involved, but this is a good place to start.

What Kind of Insurance Do I Need for a New Car?

The type of car insurance you get is dependent on whether your car is financed, leased, or owned. One thing is for certain, you must fulfill your state’s mandatory insurance requirements. The minimum insurance requirements will vary in each state, but most states require liability insurance for bodily injury and property damage. Some states might also require uninsured motorists and personal injury protection.

In addition to your state’s minimum insurance requirements, there might be additional requirements depending on how you purchased your vehicle.

Financed – If you are going to finance your vehicle, then your lender will probably require you to have comprehensive and collision coverage.
Leased – If you want to lease your vehicle, then you will likely be required to have comprehensive and collision coverage. Additionally, there could be limits on your deductible (such as not being allowed to have a deductible over $1,000) and requirements for a certain amount of liability coverage (such as $100,000 per person).
Owned – If you own your car completely, then you should only need the minimum amount of insurance coverage that the state requires. Of course, you can always add comprehensive and collision insurance if it makes sense for your vehicle. This will provide coverage in the event your car is stolen, vandalized, damaged, etc.

What is New-Car Replacement & Gap Insurance?

New-car replacement insurance and gap insurance are both optional coverages you can choose if it makes sense in your situation.

Gap insurance – This type of insurance is good for vehicles that are loaned or leased. In the event that your car is totaled, gap insurance will cover the difference between the car’s cash value and the amount you still owe on the car. For example, if your car is totaled and its cash value is set at $15,000 but you still owe $17,000 on the car, gap insurance will cover the $2,000 gap that you wouldn’t get with standard collision coverage. This keeps you from “going in the hole” if your car is totaled before it is completely paid off.
New-car replacement – This type of coverage is not as common, but new-car replacement insurance will pay for the cost of a new car equivalent to the one you totaled. For example, if your car was worth $25,000 when brand new but had depreciated in value to be worth $20,000 before getting totaled, then new-car replacement would give you the $5,000 that the standard collision coverage wouldn’t give you. This allows you to buy a brand new vehicle in the same price range as the one you had before.

Buying a New Car? Contact James Grace Insurance!

Buying a new car is not a small decision, but don’t let the insurance process stress you out. James Grace Insurance is here to help you with every step of the process. Our team guarantees exceptional service. Because we are an independent insurance agency, we can make sure we find the coverage you need at an affordable price. We’ll do the shopping, you’ll do the saving. Don’t hesitate to contact us today to get started!

10 Myths About Car Insurance

Know What Really Matters When Getting Auto Insurance

Myth #1: The color of your car matters

Many people believe that a red car means you will pay more for your car insurance policy. While insurance companies take several factors into account when determining the cost of auto insurance, the color of the car isn’t one of them. Relevant factors include: car make, model, body type, engine size, age of vehicle, sticker price, cost of potential repairs, safety record, chances of theft, etc.

Myth #2: Auto insurance gets more expensive as you get older

Actually, auto insurance might get less expensive the older someone gets. A couple of reasons include:

People who are 55+ can take an accident prevention course to get a lower auto insurance rate
Those who are retired or only work part-time tend to drive less, so they might be able to get a car insurance discount

The programs and discounts available will vary in each state and with each insurance company, so make sure you ask your insurance agent if you are eligible for a lower insurance premium.

Myth #3: Auto insurance is always more expensive for men

If a male and female are the same age and live in the same area, it’s not necessarily true that the male will pay more for auto insurance. There are many other variables an insurance company will consider that will affect the cost of insurance. These include:

Driving history
Credit report
Education
Vehicle type
And more!

Myth #4: Your credit history doesn’t matter

Insurance companies might use your credit history to determine how well you manage your finances and therefore how likely you are to file an insurance claim. Generally, people with good credit often pay less for their auto insurance policy.

Myth #5: Auto insurance coverage extends to theft, vandalism, and damage due to the environment

A standard auto insurance policy does not necessarily cover these types of circumstances. To get extended coverage, you should purchase comprehensive and collision coverage as well. It is not always worth the cost of these additional coverages if your car is not worth much, but you will need them if you want full coverage for your vehicle.

Myth #6: The minimum auto insurance for liability required by the law is good enough

If you only have the minimum car insurance coverage that the state requires, you will likely pay significant out-of-pocket costs in the event of an accident. If you have personal financial assets you need to protect, then you should consider a more comprehensive auto insurance policy in the event the other driver files a lawsuit against you.

Myth #7: If someone else drives your car, then their auto insurance policy will cover damages in an accident

While the laws differ in each state regarding this, most states require that the auto insurance policy covering the vehicle is the one that provides coverage in the event of an accident, no matter who the driver is. Make sure you check with your insurance company so you understand the rules in your state.

Myth #8: People in the military pay more for auto insurance

Actually, the opposite is true. Some auto insurance companies provide a discount for those in the military or formerly in the military. Check with your insurance company to see if you and your family qualify for this discount.

Myth #9: Your personal auto insurance policy will cover you when you drive your car for business

If you use your car for business purposes, then you will probably need to have a business auto insurance policy so that you are covered in all circumstances. Additionally, if you have employees that drive your car, you should keep updated on their driving record.

Myth #10: The cost for auto insurance increases if you get a ticket or get in an accident

While multiple traffic tickets can affect your insurance rates, getting a single ticket won’t necessarily make an impact as long as your overall driving record is clean. Additionally, some states have classes that you can take to remove the points that tickets add to your driving record.

When it comes to car accidents, whether or not your premiums increase will depend on the severity of the accident and who is at fault. For example, if you are at fault for an accident and the insurance claim includes the damages for other vehicles and the injuries of other people, then your insurance cost will probably go up. However, if you back-up into a tree or light pole and only cause damage to your own car, it’s possible there won’t be any increase in insurance costs.

Let James Grace Insurance Help You Get the Car Insurance You Need

There are many opinions and thoughts out there regarding auto insurance policies and the various factors involved in the cost of insurance premiums. Some are true, and some aren’t. Speak with your insurance provider to make sure you understand all of the variables used to determine your insurance costs, and double-check to see if you are eligible for any discounts. Feel free to contact James Grace Insurance if you have any questions! As an independent insurance agency in Arizona, we can help you get the best policy for your needs at the most affordable cost. Learn more today!

10 Questions to Ask When Looking for Car Insurance

Personalize Your Car Insurance to Accommodate Your Needs

Are you looking for a new car insurance policy that meets your budget while also providing adequate coverage for your specific needs? Everyone should have an auto insurance policy that they can rely on. If you are shopping for car insurance, there are several questions you can ask yourself and discuss with your insurance agent in order to get personalized coverage at an affordable cost.

1. How Much Do You Drive Every Day?

Some insurance policies are mileage-based meaning that the amount of miles you drive on average affect the cost of the policy. Are you someone who commutes 100+ miles to work each day, or do you mostly drive your car around town (short commute, kid’s school, etc.). If you generally don’t drive a lot, then you might benefit from a mileage-based insurance policy.

2. Do You Use Your Car for Work?

If you use your car to accomplish paid work tasks, then you will need a commercial auto insurance policy. A personal car insurance policy does not cover situations such as ride-sharing, pizza delivery, courier services, etc. If you use your car for work, make sure you let your insurance agent know so that you have coverage for all situations.

3. What Kind of Car Do You Drive?

The type of car you drive could affect the cost of your insurance policy. This is because there is data that shows that certain types of cars are more or less likely to incur an insurance claim. Some examples include:

Sports cars with powerful engines have an increased risk of theft and the cost to fix such cars is often more than a “regular” car.
Modified or classic cars often need a special insurance policy to cover any potential claims.
“Safe” cars often have certain safety features and have proven to have fewer accidents, which means that the cost to insure them is generally lower.

4. How Do You Value the Appearance of Your Car?

If you’re the type of person that will want the appearance of your car to be like new if it’s in an accident, then you might want a more comprehensive insurance policy. However, if the appearance of your car isn’t that important to you, then you could limit your policy to liability insurance, which will definitely save you money.

5. What Neighborhood Do You Live In?

Where you live and where you park your car can also impact the cost of your insurance policy. For example:

Street parking – If you park your car on the street in an urban area, then there is an increased risk of theft or vandalism. You might need a more comprehensive insurance policy if this is the case.
Suburb parking – If your car is parked in a driveway or a less urban area, then the risks of theft and vandalism are much lower. In this case, your insurance premiums might be lower as well.

6. Will Anyone Else Drive Your Car?

If someone in your household regularly drives your car, then it’s important to list them on your auto insurance policy. Most insurance policies will cover people who occasionally drive your car even if they’re not listed.

7. What is the Minimum Coverage Required in Your State?

Most states require drivers to have liability insurance at a minimum. However, these required coverages are usually low, so you might want to consider a higher level of coverage depending on your financial situation.

8. Do You Own, Finance, or Lease Your Car?

If you owe money on your car or have an obligation to keep it in a certain condition while leasing it, then you will likely need insurance that fully covers the gap in case you’re in an accident. Speak with an insurance agent to make sure you have appropriate coverage in these situations.

9. Do You Have a Pet That Rides in the Car With You?

If you have a pet that’s like family and often rides in the car with you, pet coverage will help pay for any veterinary costs in case your pet is injured in an auto accident with you.

10. Are There Any Discounts Available?

In some cases, you can receive one or multiple discounts to save on the cost of your insurance policy. Some of these include:

Safe driving record
Homeowner
Bundled policies (home, auto, boat, etc.)
Full payments when policy starts or renews (rather than monthly)

Make sure you ask your insurance agent if you can take advantage of any of these discounts.

James Grace Insurance Will Answer Your Questions

If you contact James Grace Insurance, our team will help you get an auto insurance policy that meets your needs while answering all of your questions. Because James Grace Insurance is an independent agency, we can provide personalized insurance depending on your situation. We’ll do the shopping. You’ll do the saving. Learn more today!

How Long Do You Have to File an Auto Insurance Claim in Arizona?

If you live in Arizona, it’s important to be aware of the laws regarding how much time you have to submit various claims if you are in an accident. Every state has a statute of limitations that people must follow if they are going to report the accident to the police or the DMV, file an insurance claim, or file a lawsuit against the at-fault party. If you get in a car accident in Arizona, make sure you follow the required timeframes for submitting your claims.

Timeframe for Various Claims After an Accident in Arizona

When You Should Report a Car Accident in Arizona

Each state has different laws when it comes to reporting a car accident to the police or DMV. Oftentimes, minor car accidents don’t need to be reported at all. An accident is minor if the drivers won’t need to file an insurance claim. In most cases, an accident that causes $2,000+ in property damage should be reported.

While several states give the drivers somewhere between 10-30 days to report an accident, Arizona requires that drivers immediately report the accident. This means that the drivers will call the police from the scene of the accident right after it occurs. This is often a good idea anyway, no matter what state you’re in, since a police report can be used as evidence for later claims you might file.

How Long You Have to File a Claim With the Insurance Company in Arizona

Because Arizona is an at-fault insurance state, drivers have a few options for filing their insurance claim after an accident.

Your own insurance company – If you are not at-fault for the accident, you have the option to file a claim with your own insurance company to receive coverage for your damages.
At-fault driver’s insurance company – If you are not at-fault for the accident, you can also file a claim with the at-fault driver’s insurance company to receive coverage for your damages.
Lawsuit against at-fault driver or insurance company – If you are not at-fault for the accident and the insurance claims fail or are insufficient, you also have the option to file a lawsuit against the at-fault driver to receive coverage for your damages.

All that to say, every insurance company will have different deadlines for filing an insurance claim. However, it is best to file a claim as soon as possible. If you file a significantly delayed claim, then the insurance company might become suspicious and investigate your claim first. If they decide that the damages you’re trying to receive coverage for resulted from a separate incident after the accident, then the insurance company can deny your claim.

Statute of Limitations for Filing a Lawsuit Against the At-Fault Driver in Arizona

Again, because Arizona is an at-fault state, drivers have the option to file a personal injury lawsuit against the at-fault driver to collect compensation. In Arizona, the statute of limitations for filing this type of lawsuit is two years. After two years passes, you will lose your ability to bring a lawsuit against the at-fault driver even if you deserve compensation.

Exceptions to the Statute of Limitations

While two years is the statute of limitations in Arizona for filing a car accident lawsuit, there are a few exceptions that would delay this deadline:

Rules of Discovery – Sometimes an injury is not immediately apparent after a car accident. In this case, the two-year deadline to file a claim would start once the victim’s injuries are discovered (or a date when the victim should have reasonably known about the injury).

The Victim is a Minor – If the victim is a minor, then the two-year deadline might begin once the victim turns 18.

Additionally, the requirements look different if your accident claim involves the state or federal government. You should consider the following:

Deadline – You have 180 days from the date of the accident to file a notice to the applicable state or federal government agency.

Procedure – You must notify the agency before filing a lawsuit. Each county and agency might have different forms and procedures to follow, so you should contact the applicable agency to clarify exactly what you need to do.

Attorney – It is possible to lose your right to file a claim if you don’t follow the necessary procedures. Because it is more complicated to file a lawsuit against a state or federal entity, you should consider hiring a car accident attorney for help.

Learn More From James Grace Insurance

Feel free to reach out to James Grace Insurance if you have any questions about car accident-related claims in Arizona. Our experienced team is here to help. If you are looking for an auto insurance policy you can depend on, we can also help you with that. As an independent agency, we can provide you with the right blend of price, coverage, and service. Don’t hesitate to contact us today!