You may not be aware of the many factors that car insurance companies take into account when figuring out the rates they charge their customers. There are some things that you really have little to no control over, but there are some things that are factored in when determining your car insurance rates that just might surprise you.
The first thing that is taken into account is your driving record. Have you been the cause or a victim of one or more accidents? Do you have a number of moving violations against you? Have you submitted too many claims to your current insurance company? If you can answer yes to any of these questions then you are going to pay more for your insurance because of your actions on the road.
Your age and where you live play another big part in your insurance rates. A married woman could pay less for her insurance than an unmarried man because they take into consideration the risk factors of each class of driver. The drivers who are known to pay the most for their insurance coverage are teenage boys based on annual driving records. If you live in the city you will pay more than your neighbors in the suburbs. And it is no surprise that higher crime areas present higher risks and result in higher rates.
The make, model and sometimes even the color of your car is also factored into your rates. Someone who drives a little red convertible is certainly going to pay more than another person who drives a medium compact 4-door sedan. There is also a list that comes out every year that has the top 10 cars that thieves love to steal. If your vehicle made the top 10 list you know you’re going to pay more.
Paying your bills on time will get you lower rates. In the past few years, the insurance industry started to use your credit score to determine your rates. If your credit score is good, you’re safe. If you are having financial problems, check your credit score and see if there are any errors on it. If there aren’t then set up a plan to pay your bills on time and your score could improve in as little as six months time.
The amount of time you spend on the road has a great bearing on how much you will pay for your car insurance. Someone who is on the road commuting to work two hours a day is going to pay more to insure their car than someone who works from home and uses their vehicle mostly for leisure.
These are a few of the factors that insurance companies use to figure out your rates. Take into account the things you can do to reduce your rates – drive safely, keep your credit record clean, and let your insurance agent know if your driving times have been reduced. Every little bit helps and altogether they make a difference on how much or how little you will pay for your coverage.