Why has my insurance premium increased?
The maths that goes into determining the price of insurance premiums can be pretty complex. Here at Bingle, we try to keep premiums as low as we can by doing most of our business online and avoiding costly overheads like call centres.
Premiums can still change from year to year – but identifying a single reason for that can be difficult. Your policy renewal price can be influenced by several factors.
Accessibility and cost of repairs
Thanks to the knock-on effects of COVID, repairs have become more expensive. Slowdowns in supply chains have made getting hold of the right parts harder, more time consuming, and more expensive. This has put pressure on insurance premiums – as the amount insurers pay out to repair cars affects overall costs.
Changes in vehicle market value
This one is tied to the previous point. At Bingle, we cover your car for its market value. That is, the value the market would generally pay for the car. In past years, this value would go down over time as your car got older.
More recently, car values have been going the other way, and increasing instead of decreasing. This is due to those COVID-impacted supply chain issues, which means that cars and their parts are getting harder to source, and as such, more expensive.
Wild weather
Weather events have been growing more severe, while becoming less predictable. This includes things like bushfires, floods and storms. Insurers like Bingle are paying more to repair the damages caused by these extreme events, and are expecting to pay more in the coming years. The results of this may be evident in renewal premiums.
Changes in vehicle use
If you've recently shifted the way you use your vehicle from personal to business, your premiums will be affected. After all, if you're using a car for business reasons like ridesharing, you may be more likely to be in an incident due to:
- driving in unfamiliar areas
- driving at busier times, and
- driving longer distances.
What can I do to manage my premiums?
Check your details at renewal time. Make sure you're paying for what you need, and nothing else.
- Keep your details up to date. Remember to add drivers if they're going to be using your vehicle – and remove them if they're not. Keep in mind, their details may affect your premiums!
- If your car was financed last year but you've since paid it off, great! Just remember to update your policy to reflect that.
- Keep note of how much you're driving. If it's less, maybe due to working from home more often, update your policy.
- Drive safely to avoid getting into accidents and minimise the likelihood of claiming.
- Evaluate your excess to ensure it's still right for you.
- You might have optional covers on your policy. These can be handy to have, but they do increase your premium costs. Check to make sure you've got the ones you think you'll need!
