What are the parameters that affect my auto insurance rate?


A lot of car owners often wonder how auto insurance providers calculate the auto insurance premium that is charged to a particular applicant. In fact, in some cases, you can get instant auto insurance quotes online from various auto insurance providers when you feed your details and details about your car. Although the exact contribution of individual parameters varies from one auto insurance provider to another, it can be safely deduced that all of them consider certain factors in order to determine the auto insurance premium.

Firstly, the auto insurance premium depends on the state in which you are purchasing the insurance and driving your car. If you are driving your car in less populated states or cities, the chances of accidents are lower. Similarly, if you frequently drive in areas where the roads are in a bad shape, the weather is very harsh or the terrain very treacherous, the chances of accidents are higher. Therefore the auto insurance premium too varies accordingly.

Your driving record affects your auto insurance rate to a great extent. Violating traffic signals and getting speeding tickets shows that you have a certain disregard for traffic rules that portrays you as a reckless driver. This makes you a riskier customer for the auto insurance provider and more likely to claim for damages with greater chance of being involved in accidents. Thus the auto insurance premium in those cases is relatively high. If your traffic record is clean, especially over a period of couple of years, then you can reap great benefits when it comes to auto insurance rates.

Your credit history is also an important factor in determining auto insurance rates. Higher credit scores translate to greater credibility and auto insurance providers perceive such customers as more trustworthy in terms of bill payment consistency and being safer drivers on the roads. Such customers would get better auto insurance rates. How much you need to drive and your driving proficiency are also factors that contribute to auto insurance rates. Housewives would usually drive less, in the tune of below 1000 miles a year in which case, they would get discounts on their auto insurance premium. Senior citizens who might not have the best reflexes might get higher auto insurance rates and so do working professionals who commute daily to work. On the other hand, if you have taken driving courses, then you can get lower auto insurance premiums.