Why Insurance Companies are Dropping Arizona Policy Holders

If you are legally required to carry auto insurance to drive your car, why are Arizona insurers suddenly dropping policyholders? The bottom line is the bottom line: money.

Everything is getting more expensive, including vehicle repairs, medical costs, vehicle technology, litigation expenses (dang lawyers, amiright?), and higher claim payouts. This has led most of the major insurance companies to tighten underwriting standards.

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Not Dropped, Just Not Renewed

That means that high-risk drivers— folks with multiple tickets, accidents, DUIs, or a bunch of claims—are taking the hit. They’re likely to face higher premiums or get dropped altogether than they were a decade ago.

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To be fair, insurance companies don’t just cancel policies outright, but when it’s time to renew, drivers with a complicated history may not be able to renew. It’s like the company says, “Thanks, but no thanks. Find someone else to cover your insurance needs.”

From a business standpoint, it makes sense. Insurance companies make money by carefully managing risk. Drivers with multiple tickets, accidents, or serious violations can become expensive, and they’re cutting out the extra cost, according to the Drivers With Points website.

READ: Why Using Turn Signals on Arizona Roads is Important

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Reasons An Insurance Company May Not Renew A Policy

Losing your insurance can come as a shock, but companies rarely pull a policy without cause. Here are the most likely reasons your auto insurance policy won’t be renewed:

• Multiple speeding tickets within a few years.
• One or more at-fault accidents.
• A DUI conviction.
• Serious moving violations such as reckless or aggressive driving.
• Excessive claims history.
• License suspension or an SR-22 requirement.

READ: Why Are Gas Pumps Blocked By Unattended Vehicles Now?

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How Much Can Rates Increase?

Even if you keep your policy, if you or someone on your auto insurance policy has experienced any of the above, your rates will probably climb, and even skyrocket.

Driving violations in Arizona almost always lead to noticeable premium hikes. A single speeding ticket can raise rates by roughly 10% to 30%. Multiple violations could push a driver into a higher-risk category, resulting in substantially higher premiums.

LIVINUS

If you’re involved in an accident that’s your fault, it can get really expensive. Depending on the insurer and the severity of the claim, premiums commonly rise 20% to 50% after an accident. Drivers with multiple accidents might want to look into public transportation; you may have trouble finding a company willing to offer you any coverage at all.

DUI convictions are even more expensive. Industry reports indicate premiums may increase by 50% to 200% or more, and the company may be more likely to choose not to renew your policy. A few companies specialize in high-risk motorists, and they come with a steep price tag.