Why Do My California Auto Insurance Rates Keep Going Up When My Car Keeps Getting Older?

Why do my auto insurance rates keep going up even though my car is getting older? Many of our clients in Mission Viejo and around Stanislaus County ask this question, so I would like to address it from a couple of angles.

First things first, even though it’s called car insurance, it covers much more than just your car. It’s really “auto owners” insurance, similar to how home insurance is actually “homeowners insurance.”

It’s important to understand that there are a lot of variables that go into insurance premiums, and auto insurance is no different.

The insurance company is much more concerned with you crashing into someone and causing them (or yourself) bodily harm than it is with your car. A car is a material possession that can be replaced.

A human life is not.

When is the last time you looked at your auto insurance policy?

If you look at it, you’ll notice there are a lot of different coverages on your California auto policy:

• Bodily injury liability
• Property damage liability
• Uninsured motorist bodily injury
• Underinsured motorist
• Uninsured motorist property damage
• Medical payments
• Rental reimbursement
• Towing and roadside assistance

These are all things you’re covered for on your auto policy. How many of them are about the value of your car?

None.

How many of them have a price next to them on your policy?

All of them.

Your car isn’t the only thing you’re being charged for

That’s because auto insurance covers far more important things than your car. Let me rephrase that: your car insurance rate isn’t just based on your car. Even if you dropped collision and comprehensive on an older car, you’d still be paying for liability and the other coverages that protect people.

Why are California rates rising?

A few big things have pushed rates up for everyone in California over the last few years:

• Repair costs. Newer cars are full of sensors and cameras, and parts and labor cost more than ever. Even a fender bender can be expensive.
• Medical costs and lawsuits. Injury claims cost more each year.
• Higher minimum limits. Starting January 1, 2025, California raised its minimum liability limits to 30/60/15, the first increase in decades.
• Accidents on busy roads. Traffic on Highway 99 and other Central Valley corridors keeps growing.

You’re not the only one

It’s also important to understand that you are not the only person your insurance company insures. You are one fish in an ocean of other fish, sharks, and sea creatures, all with different risk profiles.

Insurance is all about spreading costs over a large group of people, with each person paying their fair share. That group is constantly changing and is affected by many things, including the overall economy.

That’s what insurance is: sharing in the cost.

The next time your auto insurance rates go up, take a look at the big picture. Look at ALL of the coverages and their rates, and ask your agent whether you’re getting every discount you qualify for, including California’s Good Driver Discount and any low-mileage discount.

Hope this helps! If you would like to know more about car insurance, be sure to visit our page dedicated to it.