Controllable and Non controllable factors that impact auto insurance rates


There are many controllable and uncontrollable factors that decide the amount of auto insurance you pay each year. While the controllable factors can be controlled by you and others who use your car, the uncontrollable factors cannot be controlled by anyone. This article will help you understand which 6 factors affect your auto insurance premium the most.

Your Age, Gender and Marital Status are Non Controllable Factors

Your age is one of the key factors that decide the amount of premium you pay each year. Insurance companies believe that certain people are of more risk to accidents than others and they also believe that people between the ages of 21 – 55 have a lesser chance of accidents. Teenagers and young adults who are younger than 21 years are charged a higher premium and so are people above the age of 55 years old.

Your gender is another important uncontrollable factor that affects the amount of auto insurance premium you pay every year. Women are usually charged a lower insurance premium than men because insurance companies believe that women are safer on the road than men. Women who drive cars usually wear seat belts and they do not commit violations or get into accidents as much as men.

Your marital status will also decide the amount of premium you pay each year. Auto insurance companies believe that people who are married usually get into fewer accidents than people who are not married. Insurance people also believe that people who are married do not drink and drive or speed as much as people who are not married.

Your Location, Car and Credit Rating are Controllable Factors

Your location is one of the controllable factors that affect your auto insurance premium. Your geographical location is used by insurance companies to understand if your car is at a higher or lower risk for crimes like vandalism. Your geographical location also decides if you drive through busy areas that have a lot of traffic or if you drive through non congested areas. In some cases the geographical location can also decide if you park in safe garages or if you park on the street.

Your car is one of the key controllable areas that decide how much money auto insurance companies will charge you. The make and model of your car are two factors that largely affect your auto insurance premium. Other factors related to your car that affect your insurance premium is the speed you drive at, the condition of your car and the type of modifications that are used in your car.

Your credit rating or credit score helps insurance companies understand if you are a high risk customer or the perfect candidate. Your credit score along with your credit history reveals information like the number of debts you have, the total amount of debt and if you are heading towards personal bankruptcy or not. Insurance companies then use this information along with all the other information they have gathered to decide if they should give you a high premium or not. If your credit scores are really bad then you may be downright refused insurance so before you apply for insurance every year you should make sure that you take steps to improve your credit ratings.