When trying to get car insurance you may think that it is a process that ends with the same premium costs for everyone. That is not the case though. Every question that they ask will be used in a mathematical formula that they use to assign a risk number. The higher the risk number that you have, the higher your premiums will be.
The number one thing that you need to remember is that you need to compare companies. Not all insurance carriers are created equally. Forbes suggests that you check around because one company may charge you less for the same policy. Keep in mind, though, that the cheapest policy is not the best. The risk number may not be the same across the board, so when you look at the things that can affect your premium below, do not get discouraged with a high premium. Just move on to the next.
- Driving Record-How you have driven in the past will follow you throughout your years of driving. The safer that you are, the better off you will be. Tickets and accidents will be used against you to increase your risk rating. Do everything that you can to prevent accidents and tickets. It is understood that some things may be out of your control, but it will still affect your premium.
- Requirements-Every state will have different requirements that you will need to follow. A minimum amount of coverage will be set by your local law makers, so you need to ensure that your policy meets, or exceeds, those limits. The best way to shop for auto insurance is to be educated. Know what you are required to have before you decide on a carrier.
- Age-Your age will have an impact on your auto insurance. Young drivers have less experience, so they are a greater risk. Once you reach 25 rates will come down, but once you hit 65 they will begin to go up again. Elderly people are not as sharp as they used to be and can be injured easier.
- Gender-Whether you think it is fair, or not, insurance companies will use your gender against you. Younger men will be charged more than a female of the same age. In the middle years they even out a little. Once you reach your mid-forties men will be charged less than a female of the same age.
- Marital Status-You may not think that this matters if you each have your own car, but that is far from the truth. Married people drive safer and take less risks. So being married will get you some savings on your insurance policy.
- Car-The car or truck that you plan to insure will make a significant difference on your premiums. Older cars, unless they are classics, will cost less than new cars. Sports cars will cost the most. Just remember that if your car is expensive to fix or replace, your premiums will be higher than a ride that is cheap.
- Mileage-The more mileage that you put on your vehicle every year, the higher your risk will be. The higher the risk, the higher the premium. This is an aspect that you may not be able to control, but it will still have an impact on the policy price.
- Credit History-Most everything revolves around your credit score and history. The higher your number is, the better your premiums will be. That is not all that they look at, though. They will check your history to see how stable you are. If you move every other year and change jobs like you change your shirt, the insurance company will see you as elevated risk, which in turn causes a premium increase.
Premiums are affected by numerous things. Some of them you can control. Others, you cannot. Just be aware of what the insurance company looks at and make improvements to everything that you can. And it needs to be said once more, check around. Do not take the first policy that you see. Compare and evaluate them all. Choose the policy that best fits your needs, without causing you to go broke.