Have you ever wondered how your auto insurance rates are actually determined? Surprisingly, they look at a lot more than just your driving history and age.
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Before you start talking to agents or requesting quotes for auto insurance, it’s a good idea to know where you stand. Insurance companies take several factors into account when calculating rates. Knowing what those factors are, and being ready with the information before you request a quote, will help you to get the best rate possible.
What are the most important auto insurance factors?
Different companies have different criteria. Some only cover drivers with good records while others specialize in the needs of high risk drivers. We’ve compiled a list of the factors that auto insurance companies take into account when calculating your rate:
- Anti-theft devices
- Business use of vehicle
- Claims made in past
- Credit score
- Driving Record
- How often you drive
- How much you drive
- Length of time with provider
- Marital status
- Number of policies with provider
- Other drivers in household
- Safety features of car
- State laws
- Type of car you drive
- Type of policy
- Where you live
- Where you work
How important a factor am I?
Without a doubt you will discover that you are the most important factor in the rates you are offered. Yes, the type of insurance you get and the make and model of your car are important, as are many other items. However, your age, driving experience and record will follow you forever.
Even your credit score can affect the rates different companies offer.
Don’t worry; if this sounds like bad news all that can change over time. Work on that credit score, take a defensive driving class, and avoid getting any more tickets. Time offers a certain amount of forgiveness in the insurance industry. Over time, these things can work in your favor.
Is it time to look for a new auto insurance company?
There are some times when those “oops” hurt you with your current provider. Here are some situations in which you will want to compare rates and policy options with other companies. Your provider raised your rates because:
- You filed a claim
- You were involved in an accident
- Your teen started driving
- You have multiple tickets
- You have a DUI
Frankly, your insurer has every right to raise you rates in these instances because they see your level of risk has increased. However, another insurance company might not hold that filed claim against you. Or they might offer a good student discount that helps manage the costs of younger drivers.
How can I save money on car insurance rates?
You should definitely learn more about how insurance companies calculate your auto insurance rate, but you should also be sure that you’re getting the very cheapest auto insurance rates you can right now, too. Enter your zip code in on this page to get started comparing free auto insurance rates and start saving some money!