Insurers must tell you why your premium is increasing
A new rule requires all insurance companies to tell their policyholders the reasons behind a premium increase. The new regulation applies to auto and homeowners insurance, including manufactured homes, condominiums and renters insurance.
What insurance companies have to do
When a policy renews and the premium increases, insurance companies must give policyholders who ask a reasonable explanation as to why, using terms they can understand.
Renewal notices or renewal billing statements must include a disclaimer, in at least 12-point bold font, with language similar to:
- "Policyholders receiving an increase to their premiums at renewal can request an explanation by contacting their insurer in writing. Please see Chapter 284-30A WAC for additional information on your right to an explanation for your rate increase."
The disclaimer must also include the company’s contact information.
What consumers can do
Consumers can send a message to their insurance company using the contact information on their renewal notice or billing statement. This message should including their name, their policy number and the renewal date of their policy, similar to:
- “My name is Jack Q. Policyholder and my auto insurance premiums went up. My policy number is 654321 and my renewal date is June 2, 2024. Please send an explanation for why my premiums are up to my address on file.”
More changes coming in 2027
Starting June 1, 2027, if you get a premium increase when your policy renews, your insurance company must tell you why.
- Insurers must provide a written notice to policyholders receiving a premium increase of 10% or more explaining the primary factors that caused the increase. They must also provide this same notice to any policyholder who asks for one.
- Primary factors include: the location of the vehicle, driving record, miles driven, number of drivers, number of vehicles, claims history, discounts, fees and surcharges, age, credit history, education, gender, marital status, occupation, property age, location and value. Additional factors may also be included.