Do crime rates affect insurance rates?

With news of an uptick in violence across the country, we wondered, does crime affect insurance rates? We asked our internal experts, and the simple answer is yes, and here is how.

Auto Insurance

When calculating your auto rates, insurance takes in several factors, some of which are considered “non-driving” factors. These are factors such as gender, marital status, and zip code. Your local 5-digit zip code holds valuable crime information for your area. Insurance companies look for specific car-related crimes such as break-ins, vandalism, and hit and runs. By living in a ‘high crime’ area insurance companies will automatically assume you are at greater risk of any car-related crimes. This weighs into your auto premium.

Homeowner insurance

Real estate agents everywhere say Location, Location, Location, and insurance agents say the same. People who live in areas notorious for natural disasters always experience higher insurance rates, the same goes for living in ‘high crime’ areas. Again, by importing your zip code into the rating system, insurance companies will assess your ‘risk’. Proximity to emergency services can also affect your insurance rates.