Personal Details that influence Insurance Rates


What might seem like the most nondescript details are important details for an insurance Company. The reason why Insurance Companies ask that many questions is to accurately access the applicant accident potential. It is easy to understand why an insurance Company would be interested in calculating an accident potential. There are some people whose driving habits and trends render them more prone to road accidents than others. Given below is a list of a few, very general personal details that insurance companies use to gauge this accident potential 


Age is one of the most important considerations for an insurance policy. At the offset, it should be understood that this assessment based on personal details works on the principle of stereotyping. These companies will assume, mostly, that a young driver, or college student is more likely to crash his or her vehicle that a middle aged woman. Now this stereotyping has accurate countless times, as even stereotyping is based on statistically data. Age, is considered important because it dictates the lifestyle of the person. A young driver is more likely to be driving around late, fast and doing distances. This factor is considered with the next one, which is gender. 


While it would be incorrect to say that women drivers are safer drivers, statistics show the high incriminating incidence of accidents involving men. So, again as a generalization, it is assumed that the chances of a man meeting with an accident are more than those of a woman. However, women also meet with accidents and sometimes very serious ones. One must understand that for an Insurance Company receiving thousand of applications for a policy on a daily basis, there is not time or inclination to undertake a holistic character profiling of every single applicant. Moreover, these are tried and tested methods that have worked for these companies for years. The accident potential does not affect whether a person will be given Insurance or not. It merely affects the rate of the premium one is expected to pay for the policy. 

Social Settings 

Social settings will determine how several things about a person’s general routine and lifestyle. The peaceful residential neighborhoods versus the streets of downtown New York say much about the kind of driving a person from either one of these localities can be expected to do. Towns versus cities are also another important factor. Social settings also include the employment of the applicant, if any. The kind of job directly influences the kind of pay packet which in turn affects the kind of lifestyle. The lifestyle is perhaps the most telling detail of them all. After the way one chooses to live ones life reflects their personal ideologies, their character, their status, their financial standing etc. These are all connected in a complex way to the probability of meeting with an accident. Again, it would be worth mentioning that accidents by definition do not conform to any pattern. They just happen. However, some people put themselves in risky situations more often than others. Even if a person’s calculated accident potential is low, he or she may meet with an accident, and a very bad one at that. But who you are and where you come from may indicate how important safe driving is to you.