Car insurance companies take a lot into consideration when determining how much you will pay for car insurance. Though it would be nice to shop for a cut-and-dry rate, the cost of car insurance is different for everyone based on coverage types and unique variables that make up an individual’s risk profile. Continue reading to learn more about what factors determine your car insurance rates and what you can do to keep your costs in check.
Calculating Your Car Insurance Rate
There are several individual risk factors that affect the price you will pay for coverage. Some of them are difficult or even impossible to change, and others may offer you a bit more control. Knowing where you stand can help you better understand which variables could be working against you and how to leverage those that are working in your favor.
Your Credit and Finances
Information in your credit report can be used to determine your likelihood of filing a future claim. If you carry a lot of debt or have a history of prior bankruptcies and late payments, you could be flagged as high-risk. Most negative factors remain on your credit report for seven years, but you may be able to improve it by paying down your debt and paying your bills on time.
Driving Record and Claims History
If you have prior accidents or speeding tickets on your record, insurance companies may assume that history will repeat itself. People with a record of irresponsible driving behaviors may pay for it in the form of higher insurance rates for years to come. Keep in mind that if you get a new traffic violation or have been penalized for past citations, enrollment in an approved driver safety education course could help keep your insurance costs low.
Time behind the Wheel
The more time you spend behind the wheel of your car, the higher the risk of a car accident. Drivers who clock high mileage on their vehicles may pay more for car insurance than those with a standard commute. Likewise, people who work from home or only drive their vehicles for leisure may score a discount for low mileage.
Your Vehicle
If you are in the market for a new or new-to-you vehicle, be sure to factor insurance into the overall cost of ownership or leasing. The type of car you drive can have a big impact on the cost of car insurance. Insurers will want to know the type of vehicle you drive, how old it is, and its overall value. You could be penalized with higher premiums if you drive a vehicle that is a known target for theft. On the other hand, you could benefit from discounts on your coverage if your car has certain safety features, such as an anti-theft device.
Personal Traits
You cannot change who you are, but that does not mean you cannot be charged more or less for coverage based on your age, gender, or marital status. Young drivers tend to pay much more for car insurance than older, more experienced drivers. Likewise, unmarried males tend to pay more than married females, who tend to have fewer accidents. When it comes to age, there is little you can do. However, teen and college-age drivers with good grades may get a break on car insurance rates if they qualify for a good-student discount.
Shopping for Coverage
When it comes to getting a good deal on your car insurance, the first step is always working with an independent agent here at Reis Insurance. Our team understands how insurance companies formulate rates, and we work to match you with a carrier with discounts and risk tolerance that are most favorable for you.
For more information about the cost of car insurance or to request your free quotes, contact our office today.
