Insurance Rates and Zip Codes

Many people wonder why their insurance premiums increase when they move across town. However, many people don’t realize that their premiums could have very well decreased just as easily as they increased. Your new zip code, amongst other factors, is usually the main reason why you’ve experienced an increase or decrease in your premiums. If you move to an area where claims/losses are frequent or more prevalent than your current location, your insurance premiums will inevitably increase regardless of how good your driving record is or even if you’ve never had a claim/loss. Insurance companies essentially share risk amongst their clients to ensure that their claim payouts will never exceed their available cash. They determine who’s sharing risk by their respective location, which is usually zip code, or sometimes even as specific as your exact longitude and latitude. So could your rates possibly change by moving a few blocks away from your current location… the answer is yes.

Other factors that can effect your auto and home rates include: the actual risk being insured (auto, home, etc.), your individual claim/loss history, your insurance score, and other individuals in the household (spouse, children, etc.).

Questions, concerns or feedback, please don’t hesitate to email me or leave a comment.

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