It’s no surprise that the premium rate on your car insurance depends not just on the coverage options you want, but also on a few details you can’t always control.
Factors such as the amount deductible, policy options, and type of insurance are the driving factors of your car insurance rates. However, each insurance company also collects other details that can increase or decrease your insurance quotes.
The best auto insurance companies make sure that they’re giving off cheap insurance quotes to people who have a lower risk of filing a claim. Different factors, such as your basic information to your driving history, are all taken into account.
Your basic information affects car insurance rates. Insurance companies often look at statistics to analyze which demographics are more likely to get into accidents or file a claim. With this, they base how much someone should pay for auto insurance.
Your residence can affect your car insurance rates. For example, someone who is living in an area with poorly maintained roads can have a higher premium compared to another person living in a place with well-maintained roads.
The following factors are what insurance companies check on your residence area.
- Population density
- Crime rate
- Road conditions
Age affects car insurance rates, with adults enjoying the cheapest car insurance rates while young adults and older people usually have a higher premium. In statistics, people aged 21-29 are at most risk of experiencing a car accident, but it gradually reduces. By the age of 70, due to declining health and impaired vision, people are more likely to get into an accident than adults.
One of the most controversial practices some insurance companies employ is basing car insurance premiums on gender. Generally, insurance companies give a higher rate to women. However, federal laws are now being passed to prohibit such practices.
In Massachusetts, Michigan, Montana, North Carolina, and Pennsylvania, using gender to give higher insurance rates to women has been prohibited since the 1970s and 1980s. California recently joined the states that prohibit such practices last 2018.
For other states, however, gender can still influence your auto insurance, but it does not have a drastic, unlike your driving records.
It might come as a surprise to everyone, but being married can help you get cheap car insurance. The reason behind this is that several statistics have found that people who are married.
Although being married has significantly less impact than other factors like driving history, it is undeniable that married couples enjoy cheaper auto insurance compared to single people. The reason behind this is that statistics found out that married couples are less likely to file claims, and thus, saves the insurance company more money.
This discount applies to same-sex marriages. There are also a few insurance companies that allow domestic partners to enjoy the discount.
Every state in the country, except California, Massachusetts, and Hawaii, allows a car insurance company to check your credit score and see how much your auto insurance should be. People with a high credit score are awarded cheap auto insurance, while people with a lower credit score might get a higher quote than other people.
If you are working a high-risk job, it’s more probable that your insurance company will hike up your premium. People such as delivery couriers, fruit and vegetable pickers, and entertainers usually have a higher premium. On the other hand, secretaries, personal assistants, and book-keepers are among the occupations that have cheap full coverage car insurance.
Aside from your basic information, your driving history can also contribute to your insurance rates. From past accidents to how many times you use your car, these factors are what really affect your premiums.
Number of Years Driving
Just as age can be a factor in your car insurance rates, the number of years driving can also tell an insurance company how well you drive. Because of this, people who have been driving for a long time can get a lower rate compared to new drivers.
If you have many tickets and accidents on your driving record, it is a sign for the insurance companies that you are a risky driver. Because of this, they predict that you are more likely to claim and, therefore, hike up your premium.
If the other drivers who are driving the same model of car as you get into more accidents, then insurance companies will probably hike up the premium for the same vehicles. This is one of the many factors that rely on statistics, and thus, can be out of your control.
How Often You Drive
People who drive a lot, especially daily to and from work, have more chances to get into accidents. This is why using your car often can increase your car insurance rates. However, for people who rarely drive, insurance companies offer a cheaper car insurance premium.
Past Insurance Claim
Claims can be categorized into two: collision claims and comprehensive claims. Generally, comprehensive claims do not increase your premiums, but collision claims do. But before you file a ton of comprehensive claims, you should also be aware that the number of your past claims is also being taken into account for your future premium.
Tips for Getting a Lower Car Insurance Rate
Regardless of where you fall in the above categories, there are certain steps you can take to ensure that you are getting the best car insurance rate possible.
Do Your Research
Different insurance companies use different methods to get rate your auto insurance premium. You can visit forums and read reviews regarding the insurance companies that you are eyeing on. If you can get a quote online, you should compare car insurance quotes from different companies before proceeding to the application process.
Increase Your Credit Score
Credit scores are one of the biggest factors in having a cheap car insurance rate that you have control over. By making sure that your credit score is high, you can enjoy a more affordable car insurance premium.
To get a cheaper car insurance premium, you can pair it with your home insurance. Not only will you save for both, but you also do not have to process a lot of documents. You can get an auto and home insurance bundle quotes online and check if you can save a few bucks by pairing them up. You may get cheaper car insurance quotes if you have a bundle.