Why would my rate increase if I submit a claim?

Why do rates increase if you're paying for insurance coverage? I've heard that your insurance rate can increase if you submit a claim.

“Car insurance rates are often based on risk.
When you pay a premium to a car insurance company, you are transferring your risk to them. This means that they can rate policies based on how many claims you have submitted or they have paid out.
While insurance isn’t solely rated on this, it can still have an impact. The type of claim can also determine whether your rate will increase. Some insurance companies exclude not at fault claims while others rate any type.
If you’re concerned about your rate increases, you can reach out to your carrier. They’ll be able to provide you with more insight on how your policy is rated.
If your rate does increase after submitting a claim, you can also opt to compare rates with other carriers using an online comparison tool like Jerry
Emily Maracle
Answered on Jul 06, 2021
Emily Maracle is a car insurance specialist living in New York. Originally from the Pacific Northwest, she has a degree in English Literature and a background in customer service. She enjoys cooking, gardening, and living sustainably. In the future, she can't wait to upgrade to a hybrid or electric car.

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