The mystery of what goes into a car insurance rate. Why do different people get better deals on their automobile insurance? And why are some people paying extraordinary amounts for car insurance? There is a complicated formula for how rates are created – but after some research we have found ways to understand how your price is calculated. If you understand what creates a rate, you can control what you pay. All automobile car insurance prices and rates are calculated based off risk. Before you try and get your next car insurance price quote comparison, keep these things in mind.
The lower the risk and the safer you are, the less you pay and the cheaper your quote will be. So lower your risk, and know that knowledge is power!
Read the 6 secrets on how you can save yourself money on your insurance rate.
Picking The Right Car – Safer Car Means Less Payment
Different vehicles have different rates. Pick a lower risk vehicle for a lower insurance policy. One well known anecdote is that red cars are more likely to get speeding tickets. Going with that theme, it is important to understand that insurance is different for every car. It costs more to repair a Mercedes than a Toyota, and thus it will cost more to insure one as well. Understand the rates for each prospective vehicle, and know that if you are paying more for the vehicle it is likely that you will be paying more for insurance as well.
Women Pay Less – Women Are Safer Drivers
Apparently, women are less risky than men when it comes to driving. Numerous factors come into play, but this one is quite interesting. Statistics have shown that women are safer drivers and thus will end up paying less.
Your Age Matters – More Experience Means Safer Driver
Drivers from the ages 16-25 pay considerably more than other age groups for car insurance. Young men pay more than young women, but this age group is targeted for higher rates. Once a driver turns 26, their rates should stick until senior citizen age – unless there are accidents or violations incurred. Senior citizens pay slightly more than ages 26-65, but overall young people pay the highest rates.
Don’t Drink and Drive
Drinking and driving is never worth it. Not only will it cost you your license and hurt your career, it can take your insurance premium through the roof. After a drinking and driving violation or accident, it can be difficult to even qualify for insurance and you will have to pay significantly more for a second rate company. Additionally, some companies might not even pay for damages if it is revealed that the driver was drinking and driving. With the advent of Uber and Lyft, you really shouldn’t even be thinking of drinking and driving.
Discounts – Corporate Or Business Discounts
There are many corporate and local discounts on car insurance. You can also bundle your insurance policies for a lower rate. Be savvy when choosing your company, and be sure to leverage what you have. Certain insurance companies even give better rates for certain professions!
Beyond your vehicle, the insurance company is insuring your driving as well. Essentially, the insurance company is betting on your odds. They are betting how likely you are to be in an accident and whether they are buying in at a good rare or not. It is well understood how traffic violations affect your license, but be aware that each violation will also affect your insurance rate. Accidents also negatively affect insurance rates. Each time you are given a ticket or partake in an accident, the insurance company will bet against you – thus raising your rates.