There are a number of points based on which auto insurance rates are calculated in the state of California. We shall discuss the few salient factors based on which auto insurance rates are calculated,
- Firstly, it depends on ones credit history. A credit history is a record of all your financial transactions over a period of time. The credit record goes back to eight years and is maintained by one of the three credit bureaus. The credit record is kept in the form of a score which is called the credit score. you credit score will again depend on factors such as whether or not you repay your debts in time, your debt to credit ratio, and also your outstanding loans and mortgages.
- You insurance rates will also depend on the make and model of your car. If your car is a modern car with several safety features like anti lock braking system, air bags, and electronic stability program, you can expect to get a very good deal on the insurance rates. You will also get a better rate if your car is a new car and not a pre-owned one.
- Another important factor is your driving record. The California state department of motor vehicles maintains a record of all the traffic infractions that you have ever committed. It also maintains a record of all your driving accidents. This record can be accessed by any insurance company. If you have a bad driving record, you can be sure that you will not get a good rate on your new insurance policy. If you have a history of driving under the influence, it can be very difficult to get an insurance policy itself in the first place. In such cases, you will need to go with high risk insurance policies. And these will cost you a bomb to maintain in the state of California.
- Your insurance policy will also cost you a lot if you are a teenage driver. Teenagers are assumed to be high risk individuals without cause for any concern in the first place. Any youngster between the age group of 16 to 24 is put into this bracket. The reason for this is based on statistical data. Your best bet would be to get enrolled in a defensive driving class. This sort of class will not only help you better your driving skills and your risk anticipation techniques, but will also help convince the insurance company that you are serious about safe driving. It is important to convey to them in some way that you are a safe and reliable driver even though you have just got your license.
- Lastly, your rates will depend on the prevailing economic climate in the financial industry. At present, California in particular and the rest of the united state in general are undergoing a serious financial crisis. This crisis is said to be the biggest after the great depression during the early 1900’s. In due course of time, the situation might develop but for the present, the customers have to pay the price for the losses that the companies are undergoing. Insurance rates have hence gone through the roof since insurance companies are hoping to transfer the cost on to the customers.
