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Written by: Shelly Campbell

Category: Agent

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There are a few reasons that can explain why your premium changed. Is this your renewal bill? Did you move? Did you add a car or driver? Did you delete a car or driver? Did you ignore a letter the insurance company sent you asking for additional information about other household drivers? Are there outstanding late or reinstatement fees due? Any of these situations can cause your bill to change mid-term.

If it is your policy renewal bill, it may be higher than you expect for several reasons. Some insurance companies charge 20% on the first payment of a policy period and then equal monthly installments afterward. Most divide the payments equally and often don’t charge the billing fee on the first renewal payment, making it lower. Rates may change, up or down, at each renewal based on the company’s loss experience for the last six months. Loss experience is the claims and expenses involved in settling those claims. If the insurer had more claims than usual, you can expect the premiums to rise.

You may have had traffic infractions added to your policy that were not on your driving record when you originally purchased the insurance, or they just missed them the first time. Lucky you! Often, people ignore letters from the insurance company asking for additional information about household drivers, which is a very costly procrastination. Please answer any correspondence you get from us or the insurance company immediately. Ignoring them won’t make the problem go away.

Insurance rates are affected by the zip code where you live. Generally, the more populated the zip code, the higher the price.  So, moving from a Burns, Oregon, zip code to a Portland, Oregon, zip code will increase your insurance premium. The loss or claims experience is statistically higher in more populated areas.

Sticker shock! That’s what I call it when people add vehicles and choose not to simultaneously pay for the incremental monthly increase. For example, let’s say you add a car, and the insurance costs an extra $100 monthly. The insurance company already sent you a bill for the current month based on the premium before you added the new vehicle. That means you will have the new car on the policy for approximately 45 days before paying the increased premium. How will you pay for those days? Your next month’s bill will include the premium for the old car(s), the 45 days you already used on the new car, and the premium for your new car’s next 30 days.  Basically, I am saying to pay for the addition when you make it. You will be one unhappy customer if you choose to wait. You will call me, and I’ll have to explain why you think it should have only been $100 more in your next bill.

If the insurance company receives your premium after the due date, they may charge a late fee.  If your policy goes pending cancellation, the insurance company may charge a reinstatement fee. Agents cannot waive these fees; it’s not our decision. If you make a change, move, are at your policy renewal, or did not respond to an insurance company inquiry, there may be a surprise bill increase ahead.