Sometimes it can be frustrating to compare auto insurance quotes with your nearest and dearest. Things can be even worse if you seem to be the one who receives the higher quote for premiums on your car when everyone else seems to be paying hundreds of dollars less.
The reason for this, according to insurers, is the factors which determine your risk to the company. There are a number of areas taken into account, which everyone should be aware of, especially if you are eager to learn what you need to know to save on auto insurance this year.
Your personal profile
The areas auto insurance companies consider as part of your profile are (but not limited to):
- Marital Status
Auto insurance firms will always request this information as it helps them to determine the appropriate price you should pay. Considering that automobile accidents are highest for males under 25, state-approved rating factors contribute to the price you are quoted.
The vehicle you drive
While your vehicle may look the part, attract some pretty cool attention and improve your social life, it will more than likely result in higher prices for insurance. A vehicle which contains a number of safety features, roll cages and has been proven to be a safe car to drive can cost significantly less.
Where you reside
If you live in an area with a higher frequency of vehicle theft, carjacking, and general crime, you will probably feel it in your insurance quotes. Having a garage, or living in a gated compound with security will be less of a risk, and this will be reflected in your premiums.
For most states, credit history will play a major part in how you are perceived, in terms of risk, by an insurance company. The higher your credit score, the less of a risk you will be judged to as. Making regular payments to creditors or building up your credit can help you avail of better premiums.
The frequency and distance you drive
To put it simply, the more you do anything, the more chance you are of something happening. This works exactly the same way for drivers, from the perspective of motor insurers.
If you use your car as part of your job or commute long distances, the risk of you being involved in a crash or an accident, or of the car breaking down, will increase. You, as a customer, will pay for this additional risk.
One of the most major factors involved in the calculation of your premium is the type of policy and deductibles you choose. Many times, the type of cover you choose may not be required or even suitable for your purposes. On the other hand, there may be aspects of your cover which you probably may need, so be careful.
There are points which will determine how your insurance payments rise or go down, but these are the major factors to explain why your premiums have gone up, gone down or been around the same price this year.