The Rise and Fall of Car Insurance Costs
The economic downturn has caused the costs of every avenue of life to rise, dramatically. Car ownership is now considered to be a luxury and there are those that have had to make very big sacrifices due to not being able to afford the vehicle and all the costs that come with it. Budget insurance is an area that so many people attempt to achieve as one way of bringing down the overall costs but with the economy in the state that it is and the new found cultures of people it is rare to have a policy that is considered ‘cheap’.
The world we live in has become very financially orientated and there is a higher than average number of compensation claims that have a negative impact on industries and people alike. Particularly in terms of the car industry, there are more people claiming for compensation after car accidents and sadly so many of the claims are exaggerated or falsified which has a knock on effect to the honest consumer that now has higher premiums as a result.
The need to modify cars is becoming increasingly popular, films such as The Fast and the Furious have been the cause of the trend and the need for fast performance cars that represent the vehicles in the film is huge. This will dramatically increase the cost on insurance and it MUST be declared, the more you tamper with the basis of the car and the more additions that are made only allows for more to go wrong.
If you are someone that has driven for a number years in a vehicle that is as the manufacturer intended you are one of the lucky ones that will see the reward of this. There is no bonus for being of a certain age or a particular gender it is simply all to do with your driving history and the level of risk you are deemed as by the insurer. If you are able to protect your no claims bonus and not have to make claims against your policy then you can see the cost of your policy begin to decline.
Insurance is a legal requirement, which comes with vehicle ownership, regardless of whether the vehicle is in use of off the road. More and more road users are neglecting to take out appropriate insurance policies and when they are involved in accidents it is the innocent party that are forced to cover the costs by claiming on their own insurance for something that often isn’t their fault. Insurers are forced to pay out substantial amounts of money to cover uninsured drivers and this increases the cost of premiums for everyone else.
Repair costs are another area, which has caused insurances to go up, parts and servicing is now more expensive than it ever has been as companies fight to stay afloat during the economic downturn. Insurance companies need to be able to cover their significant financial losses and this affects everyone that owns a car meaning the cost of insurance is rising steadily. When the economy is repaired and penalties are stricter for uninsured drivers the cost of insurance will begin to fall and be more affordable once again.
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Category: Car Insurance
