Knowing what factors affects the cost of your car insurance can help save money on automobile insurance premiums. Here are some of the most common variables that insurance companies look at to determine how much your car insurance should cost.
Believe it or not, being married does affect the cost of your car insurance. Married people tend to have fewer accidents than single people. So as a result, married couples pay less for insurance. Also, many companies offer multi-car discounts, so insuring two cars together could also decrease your rate.
This is an obvious one. Younger drivers are less experienced and more likely to get into accidents than more experienced drivers. Young males statistically get in more accidents than young females, so their insurance would typically cost more.
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Certain makes and models of cars have higher safety ratings and as a result are cheaper to insure. The safety rating is based on features such as airbags, automatic seat belts and traction control. These features make your car safer, resulting in fewer accidents and also fewer injuries should an accident occur.
Click here to view more on how the type of car you purchase affects your insurance.
Where You Live
Location, Location, Location; seriously though, where you live is a major factor in the cost of your insurance. Insurance companies look at your zip code and evaluate the population, crime rate, frequency of claims and the number of insured motorists on the road. All of these factors are considered when the insurance company is calcluating your premium.
Click here to see an animated video on how where you live affects your insurance. .
Many companies are now taking into account your credit score when determining your insurance rate. Research shows that people with higher credit scores tend to be in fewer accidents than people with lower scores. There is no specific point at which your credit score begins to affect your rate; however, the general rule is that higher credit scores result in lower premiums.
Click here to learn more about how your credit score affects your premium.
The better you drive, the lower your insurance will be. If you have been involved in an accident or have a few speeding tickets, insurance companies see you as a higher risk to insure, so your automobile insurance will cost more.
Click here to learn more about how your driving record affects your premium.
Many people do not realize that when they are shopping for insurance, the companies actually check to see if they have maintained continuous car insurance for the last few years. Although this may seem strange, it makes sense. If you didn’t have insurance in the past year, you either were driving without insurance or didn’t have a car. If you were driving without insurance, some companies will penalize you. If you didn’t have a car, then you are now less experienced than you were the last time you were insured, so your insurance will likely cost more.
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