Making the right decision when it comes to buying auto insurance is very important. Auto insurance policies should be picked so that it completely protects the policy holder in any unlikely event. There are different policies to choose from, and getting guidance from insurance agent can be of some help for the first time buyers. Auto insurance premiums should be always kept in mind when you choose the insurance policy and most of the times premiums decide the policies that the drivers buy. However, cutting down policies to reduce the premium is not a very good idea. There are many ways to reduce the premiums without cutting on the necessary coverage.
Understanding the different factors that affect the premium rates can help in planning to reduce the premium rates. There are many factors affecting the premium rates including the following:
Geographical area:
Premium rates hugely depend upon the geographical area that the driver resides in. since severe weather and natural disasters can damage the cars the policy holders from the area that are prone to these conditions pay more premium rates. Also, other factors like theft, vandalism and fire can damage the car so if the area of residence has a history of any of these factors, the premium rates are high.
Model of the car:
The model of the car influences the premium rates, since some models are safer on roads than the others. Insurance companies go by the statistics of the previous years to determine the safe models, and the models that cost high premium rates. If the car is old, then updating the car model to a safer one can save more money over time. Also, fixing the car with security devices can earn extra discount points in terms of premium rates. For people who are buying new cars, it is always a good idea to consult the list of safe cars from an insurance company.
Driving record:
This is the factor that is in complete control of the driver of the car. Good driving records earn great discounts on premium rates, so following all the traffic rules and driving safe is very important. Faulty driving records are instantly reflected in the records of insurance companies, and the premium rates go high with every traffic offense. Maintaining good driving record for one complete year can earn bonus discounts for the following year for existing customers.
Age of the driver:
The age group of the driver matters a lot when deciding upon the premium rates of the policies. Insurance companies consider teenage drivers and senior driver above the age of 50 years to be risky drivers. So the premium rates for these drivers are higher than the others. However, taking defensive driving lessons and maintaining good driving records will bring down the premium rates effectively. Also, registering for the policy along with a group or under a family coverage will also bring down the premium rates since the number of cars to be insured increases. It is ideal for teenagers and senior drivers to effectively reduce premium rates on their policies.
