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Factors that are used to calculate motor vehicle insurance


There are a lot of online sites which help interested individuals with auto insurance quotes, given their driving record information, the car they own and other details. These auto insurance quotes are extremely helpful because it isn’t easy to arrive at an objective figure when you try to estimate what your auto insurance should cost. However, it is definitely within the powers of an individual to understand more about the factors that usually affect the premium for auto insurance. Insurance providers usually collate all the information they can to find out how risky an individual is and what the chances of his or her involvement in an accident are. Here are some factors that are considered for calculating premiums for motor vehicle insurance.

Age and gender

Drivers below the age of 25 or above the age of 55 – 60 are considered to be in the high risk group. While the former are considered way too reckless, the latter are considered risky because of their slowed reactions and possible impairment of senses that sets in due to old age. Similarly, whether a person is going to college or office, whether it is a housewife or someone who commutes to office, goes a long way in determining the related risk of an accident.

Driving record

This is the most objective proof of a person’s driving competence and hence the risk associated with them. Someone with umpteen speeding tickets and traffic violations is considered reckless on the roads, with disregard for personal and others’ safety. Such individuals usually have to pay a higher premium as they are more likely to be part of an accident.

Relevant gadgets

There are insurance providers which are giving discounts as high as 25% to those individuals who agree to install gadgets in their cars that record their mileage and driving patterns. This system ensures better rates for those who generally drive carefully and drive less. Similarly, anti-theft mechanisms and air bags in the car will help you elicit discounts from insurance providers on all kinds of insurance policies.

The area

Cities with busier roads, more vehicles or roads in bad condition could be more expensive for car insurance compared to quieter cities with larger roads. Similarly, cities which are vulnerable to natural disasters translate to higher premiums for comprehensive auto insurance against damages caused by unforeseen natural calamities. Similarly, those who drive more under bad weather conditions get their insurance at higher premiums.