A car insurance premium, which is the actual amount of money charged by a car insurance company to a car insurance policy holder (policy holder is a motorist who has a car insurance policy), can be expensive or cheap. This depends on factors that a car insurance company takes into consideration. And these factors that car insurance companies that take into consideration are mostly things that are found on the motorist applying or having a car insurance policy.
Some of these factors are:
- The driving history of the motorist applying for car insurance. High number of traffic violations and/or tickets contributes to a higher car insurance premium. Because these tickets and/or violations shows a motorists attitude while driving.
- The age of the motorist. Ages, from 16 years old to 21 years old, and 60 years old and above, are considered motorist that are accident prone, compared to ages fro 40 years old to 50 years old.
- The place where the motorist reside. Residence is considered by car insurance companies because they take into consideration the probability of the car being stolen, so thus high crime rated areas contribute to a higher car insurance premium. Aside from these factors that are mentioned, there are still other factors that can be found on a motorist that car insurance companies take into consideration. And also, aside from factors that found on the motorist, car insurance companies, of course, consider what the coverages that are included in the car insurance policy itself. Car insurance coverage is simply what determines what kinds of situations a car insurance company will provide insurance protection to its policy holder. To put it simpler, here are sample of insurance coverages and the situations that these coverages will take effect in providing insurance to a policy holder:
- Collision Coverage. As the name suggests, collision coverage will provide insurance protection to a policy holder in cases where in the policy holder’s car incurred damage through collision with a car, a non-moving object like lamp posts, fire hydrants and the like.
- Liability Coverage. Liability Coverage, which includes Bodily Injury Coverage and Personal Property Liability Coverage, insures or pays for the medical expenses of all people inside the other party’s car/s and repair for all the property of the other party/s involved in the accident, and the policy holder is at fault, meaning the one who caused the accident.
These are just examples of coverages that can be included in a policy holder’s car insurance policy.