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Factors that affect auto owner’s insurance premiums


When visiting the different websites to shop for auto owner’s insurance, you will find different factors that have an effect on the amount to be paid as premium. Some of the most important factors that effect auto owner’s insurance premiums are listed below.


The deductible is the amount that the owner is billed other than the insurance money. Increasing the deductible brings down the premium rate. The lower the deductible agreed upon by the owner higher will be the amount for monthly insurance payment. Increasing the deductible gives the chance for saving and also in case of situations where the insurance needs to be claimed, the owner can be assured of higher returns from the insurance company.

Absorbing minor repairs

Small damages that can get repaired without much expense should not be claimed from an insurance company. In case small repairs are claimed then in the subsequent year the premium for the auto owner’s insurance increases. The best way of avoiding such a situation is to absorb fender benders.

Age of the car

Owners should avoid spending too much on collision and comprehensive insurance for their older cars which have lost their market value. Such insurance will definitely increase the premium which might stand to be more than the actual value of the car.

Car models

Expensive cars have parts that are also costly. In case of damage or repair, these parts will cost more to the insuring company and therefore the model of the car affects the premium rate.

Type of car

There are cars that are used for domestic purposes and others that are used for races. Racing cars draw more auto owner’s insurance premium rates than other cars. The more the usage the greater will be the premium as the insuring company will consider the risk factor associated with the car to be greater.

New car owner

Owners who have just obtained their license or first time drivers attract greater auto owner’s insurance premium rates. This is because with no driving history the insurance firm is not able to judge the driving skills of the owner and therefore takes it as a risk for the company.

It is not always possible to reduce the premium rates. Some reductions are also not worth the saving. It is always advisable to purchase an the insurance coverage only after a thorough comparison of the quotes given by the different insurance firms. Discounts can be availed if the car owner complies with the rules and regulations of the auto insurance company.