Auto Insurance Rates are based on a number of different factors. Base rate is the premium you pay for the auto insurance. Age, sex, marital status, driving pattern, claims history, location, credit
history, the make, model, and year of your vehicle are the different factors in which the base rate
of the auto insurance is adjusted.
You have to keep in mind when you shop for auto insurance rate
that each company uses these factors differently.
Age
According to Statistics, when comparing with the adults aged
between 25 and 65, drivers under the age of 25 have more accidents.
Consequently,
insurers charge young drivers and families with young drivers in the household
higher auto insurance rates. The involvement of the senior citizens in an
accident is also revealed by the statistics.
Gender
When
comparing with any other population group, young men under the age of 25 are
involved in more accidents per miles.
Marital Status
According to statistics, when comparing with singles, married couples have fewer accidents
and generally pay lower auto insurance rates.
Vehicle Type
In general, the more costly your vehicle, the more you will pay for comprehensive and
collision coverage. Also, because sports cars and high-performance cars are
involved in more accidents, cost more to repair, and are stolen more often,
they cost more to insure.
Location
In a highly
populated area a higher number of accidents will raise both liability and
collision premiums. For comprehensive coverage, higher crime rates in urban
areas can also raise premiums.
Even though you may drive to a more urban or
rural area, the law also lets the companies to base your rates on your address.
Driving Patterns
You rates
also increased due to the number of miles you drive per year. The
distance you commute to work are considered as additional miles you add to your
non-commuting, "pleasure" miles by insurance companies.
Driving Record and Claims History
For the
drivers involved in an accident or convicted of multiple traffic violations, most
companies apply a surcharge. Similarly, the more claims you file, the more
likely your rates will increase.
Credit History
Credit history is one factor that impacts your auto rate under federal law (Fair
Credit Reporting Act).
Depending on your credit history, they may allot you an insurance score. In order to decide whether to accept or reject your coverage, or how much to charge you, they use your score as one factor.
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