In 2023, 43 states saw double – digit car insurance premium increases, and a 2025 LegalClarity Insurance report warns of a potential 19% rise due to tariff and inflation. If you’re facing a sudden premium spike, don’t panic! You have options. Contesting the increase is possible, as recommended by Insurance Journal and SEMrush. Shopping around can also land you a premium at a best price guarantee. With the rate of increase outpacing homeowners’ premiums (S&P Global Market Intelligence), it’s urgent to act now and explore your choices for a better deal!

Understanding Rate Hikes

In 2023, car insurance consumers witnessed double – digit increases in 43 states, and in 2025, auto insurance premiums may rise 19% when combining tariff and inflation effects (LegalClarity Insurance 2025). Understanding why your car insurance premium has increased is the first step in deciding whether to contest it.

Common Reasons for Increase

Accidents at fault

Since all states follow a fault – based system for vehicle damages in auto accidents, the driver at fault is most often the one who can expect a rate increase. For example, if a driver causes a major collision that results in significant property damage and personal injuries, the insurance company will have to pay out a large claim. To cover these costs, they will likely raise the driver’s premium. Pro Tip: To mitigate the impact of an at – fault accident on your premiums, maintain a clean driving record after the incident. Over time, the insurance company may view you as a lower – risk driver again.

Traffic violations

Traffic violations can have a lasting impact on your car insurance premiums. A recent violation is more likely to cause a significant increase. For instance, a driver who gets a speeding ticket might see their premium go up right away. Compounding violations can have a domino effect, leading to even higher rates. A study by Consumer Reports in 2021 found that some auto insurers quoted higher car insurance rates to drivers with a history of traffic violations. Pro Tip: If you’ve received a traffic violation, consider attending a defensive driving course. Some insurance companies may offer a discount for completing such a course.

Lapses in coverage

Letting your car insurance coverage lapse can also lead to a premium increase. Insurance companies view drivers with lapses in coverage as higher – risk. For example, if a driver forgets to renew their policy and then tries to get coverage again, the insurer may charge a higher rate. To avoid this, drivers should explore grace periods offered by insurers or set up automatic payments to avoid unintentional lapses. Pro Tip: Set up reminders for your policy renewal dates to ensure you don’t experience a coverage lapse.

Market Trends Influencing Increases

Inflation has been a major factor in insurance premium increases since prices took off in 2021. The cost of car parts, car repairs, and medical expenses has gone up, which means insurance companies have to pay more when a claim is made. As a result, they increase premiums to cover these rising costs. Fraudulent claims are also a perennial issue. Staged car accidents and exaggerated damages force insurance companies to raise rates to offset their losses. Additionally, an increase in car accidents involving drivers distracted by their phones has contributed to higher claim costs, leading to premium hikes.

Laws and Regulations

Insurance companies must comply with state regulations when setting rates. Many states require companies to submit proposed rate changes for approval, and some have mandated stricter justifications for premium increases. For example, regulatory shifts can result in insurers spreading costs more evenly across policyholders, leading to rate hikes even for those with clean driving records. Changes in liability laws and legal precedents also play a role. Personal injury lawsuits, which have seen an upward trend in many regions, with courts awarding larger payouts for medical expenses, lost wages, and pain and suffering, cause insurers to spread these costs across all policyholders.
Key Takeaways:

• At – fault accidents, traffic violations, and lapses in coverage are common reasons for car insurance premium increases.
• Market trends such as inflation, fraudulent claims, and distracted – driving accidents contribute to rising premiums.
• Laws and regulations can impact how insurers set rates and may lead to industry – wide adjustments.
  As recommended by industry experts, it’s important to stay informed about these factors so you can better understand your premium increase and decide if it’s justifiable. Try our car insurance premium calculator to estimate how different factors might affect your rates.

Contesting a Premium Increase

Did you know that premium insurance rates continue to trend upward, with car insurance consumers seeing double – digit increases in 43 states in 2023? Facing a sudden spike in your car insurance premium can be both frustrating and financially burdensome. However, you have the right to contest such an increase. Here’s how you can approach different scenarios.

Contesting Due to Misjudged At – Fault Accident

Appeals process

Since all states follow a fault – based system for vehicle damages in auto accidents, the driver at fault usually faces a rate increase. But if you believe the fault was misjudged, there’s an appeals process. Most insurance companies have an internal appeals mechanism. You can start by reaching out to your insurance agent or the company’s customer service department. Explain your situation and let them know you wish to appeal the rate increase. As recommended by Insurance Journal, keeping a record of all communication during the appeals process is crucial.

Requesting detailed explanation

Pro Tip: Always request a detailed explanation from your insurer. They are obligated to provide a valid reason for the rate hike. In case of a misjudged at – fault accident, ask for the evidence they used to determine fault. This could include police reports, witness statements, or photos of the accident scene. A practical example is a case where a driver was wrongly labeled at fault. After requesting a detailed explanation, they found that the insurance company had misinterpreted a witness statement.

Proving not at fault with other driver’s negligence

If you can prove the other driver’s negligence, it can significantly strengthen your case. For instance, if the other driver was texting while driving or ran a red light, gather evidence such as traffic camera footage or statements from other witnesses. A 2024 SEMrush study found that in 30% of contested car insurance rate hikes related to misjudged at – fault accidents, drivers were successful when they could prove the other driver’s negligence.

Contesting Due to Traffic Violation

Traffic violations are a common reason for premium increases. However, if you believe there was an error in the citation or if you’ve taken steps to improve your driving behavior, you can contest the hike. For example, if you completed a defensive driving course after the violation, present the certificate to your insurer. Some states also allow for traffic violations to be dismissed or reduced if you meet certain criteria. Check with your local DMV for more information.

Contesting Due to Regulatory Changes

Insurance companies must comply with state regulations when setting rates. Regulatory changes can sometimes lead to industry – wide premium adjustments. But if you think the increase is unjust for your specific situation, you can argue your case. For instance, if a new law mandates higher minimum coverage requirements, but you already had coverage well above the new minimum, you can ask your insurer to re – evaluate your rate. Note that while regulators oversee pricing structures for fairness, you still have the right to question how these changes affect your individual policy.

Arguing Against Market Trends

Just because the market is experiencing a general increase in insurance rates doesn’t mean your increase is justified. Insurance companies often cite factors like inflation, an increase in car accidents, or higher claim costs as reasons for rate hikes. But you can compare your current situation to previous years. If your driving record has remained clean, your car hasn’t changed significantly, and you haven’t made any claims, you can argue that your rate shouldn’t increase as much as the company is proposing. For example, compare itemized policy charges before and after the premium hike and ask your insurance company to explain the differences.

Evidence Collection

When contesting a high car insurance premium, assembling the right documentation is necessary to support your case.

1. Gather any police reports, accident photos, or witness statements related to an accident.
2. Obtain certificates of completion if you’ve taken a defensive driving course.
3. Keep records of your communication with the insurance company, including emails, phone calls, and letters.
4. Compile data on your past driving history, including the number of years without an accident or traffic violation.
5. Research industry trends and competitor rates to show that your increase may be disproportionate.
   Try our online insurance rate comparison tool to see how your current rate stacks up against others in the market.

Shopping Around After a Rate Increase

Did you know that premium insurance rates have been on a steady upward trend? In 2023, car insurance consumers witnessed double – digit increases in 43 states (SEMrush 2023 Study). When you’re faced with a significant car insurance premium increase, shopping around can be a powerful strategy to find more affordable coverage.

Why Shopping Around Matters

Auto insurance premiums are climbing at an alarming rate. On average, auto insurance rates are rising faster than homeowners’ premiums, with homeowners’ premiums seeing an average increase of over 11% last year according to S&P Global Market Intelligence. This shows that the cost of car insurance is a significant financial burden for many.

Case Study: John’s Experience

John, a 35 – year – old driver from Ohio, saw his car insurance premium increase by 25% after a minor fender – bender. Instead of accepting the hike, he decided to shop around. He got quotes from five different insurance companies and found one that offered similar coverage at a 15% lower rate. This real – life example illustrates the potential savings that can be achieved by not sticking with your current insurer.

Pro Tip:

When shopping for car insurance, don’t just focus on the price. Look at the coverage limits, deductibles, and the company’s reputation for customer service. A low – cost policy might not be the best if it doesn’t provide adequate coverage or has a history of poor claims handling.

How to Shop Around

Step – by – Step:

1. Compile a List of Insurers: Start by making a list of well – known insurance companies, as well as some local or regional ones. You can get recommendations from friends, family, or online reviews.
2. Gather Information: Collect all the relevant information about your driving history, current coverage, and vehicle details.
3. Get Quotes: Use online quote comparison tools or contact the insurance companies directly to get quotes. Make sure to provide the same information to each company for an apples – to – apples comparison.
4. Compare Policies: Look at the coverage details, premiums, deductibles, and any additional benefits or discounts offered by each policy.

Comparison Table: Insurance Companies

Insurance Company	Premium (Monthly)	Coverage Limit	Deductible	Customer Service Rating (Out of 5)
Company A	$120	$500,000	$500	4
Company B	$135	$750,000	$750	4
Company C	$110	$300,000	$300	3

As recommended by Insurance Quote Pro, using an online quote comparison tool can save you time and help you find the best deals. Top – performing solutions include The Zebra and Compare.com.

Key Takeaways:

• Shopping around can potentially save you a significant amount of money on your car insurance premiums.
• Don’t base your decision solely on price. Consider coverage and customer service.
• Use comparison tools and gather multiple quotes to make an informed decision.
  Try our car insurance quote comparison calculator to quickly find the best rates for your needs. Remember, test results may vary, and it’s always a good idea to review your policy before making a decision.

FAQ

How to contest a car insurance premium increase due to a misjudged at – fault accident?

According to Insurance Journal, contesting a misjudged at – fault accident starts with using the insurer’s internal appeals mechanism. Contact your agent or customer service. Request a detailed explanation of the fault determination, like police reports. Prove the other driver’s negligence with evidence. Detailed in our [Contesting Due to Misjudged At – Fault Accident] analysis. Semantic variations: appealing insurance rate, misjudged fault claim.

Steps for shopping around after a car insurance premium increase?

First, compile a list of well – known, local, and regional insurers through recommendations or online reviews. Then, gather driving history, current coverage, and vehicle details. Next, use online tools or direct contact to get quotes, providing consistent information. Finally, compare coverage, premiums, deductibles, and additional benefits. Detailed in our [How to Shop Around] section. Semantic variations: insurance rate comparison, finding affordable coverage.

What is the impact of traffic violations on car insurance premiums?

A recent study by Consumer Reports in 2021 found that traffic violations can have a lasting impact on car insurance premiums. A new violation often causes an immediate increase, and compounding violations lead to higher rates. Some insurers quote higher rates for drivers with a history of such violations. Consider a defensive driving course to mitigate this. Detailed in our [Traffic violations] analysis. Semantic variations: violation – related premium hike, impact of infractions on rates.

Contesting a car insurance premium increase vs shopping around: which is better?

Unlike shopping around, which focuses on finding a more affordable policy from another insurer, contesting an increase aims to keep your current policy at a lower rate. Contesting is useful when you believe the increase is unjust, while shopping around is great for broader market exploration. Results may vary depending on individual circumstances. Detailed in our respective sections on contesting and shopping around. Semantic variations: insurance rate dispute, policy comparison shopping.