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Why doesn't my insurance premium go down as my car gets older?

If my car depreciates in value every year, shouldn't my insurance rate decrease every year? I feel like my policy gets more expensive every time it renews.

avatar
Shannon Martin · Updated on
Reviewed by Shannon Martin, Licensed Insurance Agent.
The coverage that is affected by the age and value of your car is
comprehensive coverage
and
collision coverage
In most cases, you will see the rate of these individual coverages go down over time. The insurance carriers have to account for the cost of labor, which tends to stay the same or increase over time.
The liability portion of your policy is not connected to the age of your vehicle. The costs of
bodily injury liability
and
property damage liability
are based on:
  • The cost of healthcare in the area where you live
  • The likelihood of being in an accident
  • Your past driving history
These liability factors can cause your policy rate to increase even as your car gets older.
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