Six Factors that have a bearing on your Auto Insurance Premium

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Most people are aware that auto insurance premiums are affected by various controllable and uncontrollable factors. While car owners have no control over certain factors they certainly have control over many factors that can bring their car insurance premium down by 20%. This article will elaborate on some of the common controllable and uncontrollable factors that affect auto insurance premiums.

Physical Fitness

The health of a person is one of the controllable factors that affect auto insurance rates. People who have vision problems end up paying more for vehicle insurance since vision problems can cause accidents. People who smoke also usually pay more for auto insurance. Car owners who have joint related problems that hamper their driving skills are also asked to pay more than owners who do not have these health problems.

Age and Sex

The age of a person determines his driving abilities and it also helps auto insurance companies understand if the person is more likely to get into an accident or not. Car owners who are younger than 21 or older than 65 are charged a higher premium compared to car owners who are within the age of 21-65. The sex of a person also determines if he is more or less likely to commit violations or get into an accident. Vehicle insurance companies have reasons to believe that male owners are more likely to get into road accidents or commit violations. Female owners on the other hand are offered a lower premium since they wear their seatbelts and they drive comparatively safely.

Credit Score

The credit score of the applicant is one of the main factors that is taken into account when the premium is calculated. This controllable factor can increase or decrease your premium by up to 20%. People who have a bad credits core and a lot of debt are often offered high insurance premiums or refused insurance all together. People who have good credits scores on the other hand are offered low insurance premiums since they are less likely to default or miss an installment.

Driving Record

The driving record is another important controllable factor that affects the amount of premium paid. The driving record of a person indicates the way he drives, the violations he has committed and the accidents he has caused. By driving safely and by following the law car owners can decrease the amount the pay to insurance companies.

Car Type and Cost

The type of car and the amount paid for the car are two important controllable factors. People who own cars that are expensive or hard to find are charged a higher premium compared to people who own easy to find or affordable cars. Two door cars, sports car and luxury cars are usually charged the highest premiums. The VIN number of your car will also indicate the amount of premium you will need to pay to auto insurance companies.

Accidents

Accidents are one of the main factor that causes the premium of a car owner to be increased significantly. The first fault accident that the car owner commits increase his premium by approximately 20% and every accident after that is taken into consideration before the premium is calculated for the next year. Some insurance companies may even increase the premium for the current year if the car owner commits a lot of accidents that are his fault.