New Mexico – Factors that Affect Auto Insurance Rates


The state of New Mexico has written a lot of rules and regulations to ensure the drivers and motorists on the roads today are safe.  These rules and regulations have to be followed at all costs. Any driver found violating any of these rules will be penalised. One rule that is very important is the rule regarding auto insurance. New Mexico, like many other states, has made auto insurance mandatory. Any driver on the road should be carrying his proof of insurance. Insurance has been made mandatory to ensure that a driver is able to pay for all the damages he might have caused in an accident. New Mexico follows the Tort system of rules. According to this, a person has to be found responsible for an accident and he should pay for all the damages caused.

The mandatory insurance coverage of New Mexico is of the form 25/50/10. This stands for twenty five thousand dollars for bodily injury per person in an accident and a total of fifty thousand dollars for bodily injury in total for an accident. It also includes a mandatory ten thousand dollars for property damage. Property damage covers any damage caused to the other person’s car, any buildings, fences or lamp posts. Bodily Injury will cover any medical costs incurred and lost wages, if any.

Now that auto insurance has been made mandatory and everybody has to have it, the obvious question would what are the factors that determine the rates of insurance. There are many factors determining auto insurance rates. These factors can be broadly divided into two categories. The two categories are factors that you can change and the factors that you cannot change.

Age plays a very important role in determining your interest rates. This is a factor you cannot change. A driver below twenty five is assumed to be high risk and will be charged high rates. A driver above fifty years of age will be charged very low premiums as they are considered very safe drivers. The gender of the driver matters as well. Women are known to be better and safer drivers, statistically. They will be charged very low interest rates. Married people are considered to be very safe drivers. They will be charged very low rates.

These were the factors that you could not change or do anything about. However, there are a few factors that you can alter to your benefit. One such factor would be geography. If you live in a rural location with lesser number of people, the chances of you being in an accident are very low. Hence, your premiums will be low. On the other hand, if you live in the centre of a large city, the probability of your car being involved in accident is high. Therefore, you will be charged a high premium. People living in area with a high rate of crime and theft are bound to get high premiums as the chances of theft are very high. A clean driving record will ensure low premiums. A good credit score will also ensure low premiums.