What To Know About The Rising Cost of Car Insurance In Texas
The Texas Department of Insurance reported that car insurance rates surged by more than 25% last year, marking the largest rise in over ten years and more than double the average increase seen across the country.
Currently, the typical expense for full coverage car insurance in Texas stands at $2,565 annually, which breaks down to roughly $214 each month for a 35-year-old driver who has good credit and a spotless driving record. In contrast, the average cost for minimum coverage for the same type of driver is $813 per year, translating to about $68 monthly. However, these figures are just averages. The actual amount you will pay for car insurance in Texas is influenced by your individual traits and driving history, as various elements like your age, the insurance provider, and your driver profile all play a significant role in determining your insurance costs.
Having Tickets or Accidents on Your Record Raises Your Rate
Insurance costs for drivers in Texas who are considered high-risk can differ based on the specific violation and the insurance company. Certain companies focus on providing auto insurance for high-risk individuals in Texas and might offer better rates for those who have several violations.
Tickets
Car insurance premiums usually go up by about 21 percent if you get convicted of a speeding ticket. In Texas, the points from moving violations stay on your driving record for three years after you receive a ticket. The silver lining is that most auto insurance companies will only raise your rates for a period of three to five years after the ticket.
The amount your insurance goes up after getting a speeding ticket can differ depending on your insurance company and where you live. For instance, if you have State Farm in Texas, you might see your premium rise by about 9 percent after a ticket, while those with Allstate only face an average increase of around 1 percent. Because of these differences, it’s smart to look at various insurance options and compare rates if you’ve received a speeding ticket.
Accidents
After an accident, it’s common for your auto insurance premium to rise, especially if you don’t have accident forgiveness coverage and it’s your first incident. If you were responsible for the accident, the chances of your rates going up are even higher.
A premium hike of 20-50% might look pretty high at first glance, but the average rise in rates after being at fault in an accident is actually around 42 percent nationwide. If you haven’t had any accidents in the past but are worried about what might happen in the future, it could be worth checking if your insurance company provides accident forgiveness. If you qualify for it, this extra coverage can help shield you from a rate increase after your first at-fault accident. However, it’s important to note that this option is typically not offered to drivers considered high-risk.
One more reason why insurance rates might go up is due to civil penalties imposed by the state, which depend on the kind of violation. For instance, if you get convicted of a DWI, you could end up paying fines that reach as high as $10,000, serve a prison sentence of up to 10 years, and even have your driving rights taken away for as long as two years.
How to Decrease The Amount You Pay for Car Insurance
Compare insurance companies and take advantage of discounts. Insurance companies often provide a variety of discounts that can assist policyholders in reducing their premium costs. Some of these potential discounts might involve bundling multiple policies, being a good student, owning an electric vehicle, or having safety features in your car.
Practice good driving habits. Being labeled as a high-risk driver doesn’t mean you’re stuck in that position forever. While most violations on your driving record can impact your insurance premiums for about three to five years, if you manage to steer clear of more tickets and accidents, you should start to notice a decrease in your rates over time.
If you get a ticket, take a defensive driving class. Taking state-approved defensive driving courses can be a great way to enhance your driving skills and potentially lower your car insurance rates. You might find that many of these courses are offered online, making it convenient to fit them into your schedule.
How The Weather and Auto Theft Impact Rates
The weather we’re experiencing today is actually causing insurance prices to rise. In the past, risks related to climate have affected homeowner insurance rates, but now, car insurance companies are also taking these risks into account. Rates for comprehensive car insurance, which usually covers damages from weather events, are going up because the costs associated with these incidents are increasing. According to a study by Insurify, there was a 56% increase in billion-dollar climate events from 2019 to 2023 compared to the previous ten years, leading to a staggering cost of over $123 billion for the country during that time.
Car theft is significantly contributing to the rise in insurance premiums, alongside the dangers posed by extreme weather. Texas, which ranks just behind California, saw more than 115,000 cars stolen last year, reflecting a 10% rise in such incidents. Additionally, the escalating expenses associated with car repairs, particularly for newer vehicles that come with advanced safety features, are further straining finances. According to the Bureau of Labor Statistics, there has been a staggering 38% increase in the costs of car maintenance and repairs over the last five years.
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