Factors Affecting Auto Insurance Premiums

The cost of auto insurance premiums varies significantly from vehicle to vehicle and person to person. In fact, many factors affect the premium you pay for your auto insurance.

The risk associated with an accident therefore has a major influence on the insurance premium. The higher the risk, the more you will have to pay for the insurance.


1. Age: Statistics show that younger people are at a higher risk of having an accident than older people. In general, drivers between the ages of 50 and 65 are considered safe drivers.

2. Sex: Women are believed to make fewer claims than men and are considered safe drivers.

3. Driving history: Usually, those with a clean driving record attract lower auto insurance premiums.

4. Geography driver: Your home address also makes a difference in the premium of the car insurance. People living in low traffic areas are expected to spend less on auto insurance compared to people living in high traffic urban areas. Auto insurance premiums vary from zip code to zip code, depending on the number of car thefts in the area. If you live in a risk area, your insurance premiums are expected to be higher.

5. Car brand: Luxury and powerful cars are usually expensive and often stolen. Therefore, it can be more expensive to insure. On the contrary, a cheap car costs less to insure.

6. Driving Violations: If you have an accident record, you are at a higher risk and so your auto insurance premium will be relatively higher. You can be penalized by the car insurance company for up to five years from the date of the accident. However, your premium gets lower with the improvement of your driving data.

7. Credit Rating: If you have a bad credit history, the auto insurance company will charge you a higher premium. You can work on your credit to get a better score. This allows you to save on your premiums.

8. Parking spot: Your car insurance premium is strongly influenced by where you park your car. If your car is protected against theft and damage, the premium is low. So make sure to park the car in your garage and have a car alarm or tracking device to pay less premium.

9. Annual mileage: The auto insurance company also estimates your vehicle’s annual mileage. This is because the annual mileage of the vehicle gives the insurer an idea of ​​the risk level of an accident. This can affect your car premium to a certain extent.

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In short, before purchasing auto insurance, make sure to compare the rates offered by various local auto insurance companies to get the best deal in auto insurance. You can take full advantage of these factors and work towards lowering your auto insurance rates.