Car Insurance Rates Revealed – What Determines Your Rate

When it comes to auto insurance, knowledge is power.  If you are trying to get the most affordable auto insurance premium you can, you need to understand what causes your insurance premium to fluctuate up and down.  Once you know what is affecting your insurance premium, you are better prepared to do something about it.

Age. Age is a huge factor that determines your car insurance premium.  If you are young and have little experience behind the wheel, your insurance cost is sure to be higher.  On the other hand, if you have been driving for 20 years, you will probably have less expensive insurance costs.

Credit.  Auto insurance companies have found a significant correlation between your credit score and the likelihood that you will be involved in an accident.  Poor credit seems to lead to a higher probability of an accident, while excellent credit seems to lead to a higher probability of no accidents.

Vehicle.  What type of vehicle are you driving?  If you have a flashy, high-end, or fast vehicle, you will be paying more for your insurance.  High-end cars are not only more expensive to fix and repair, but also promote their drivers to “test the limits.”  Most people that drive less expensive cars don’t always feel the need to impress themselves or others with how fast their car can drive or how it corners.

Location.  Your location has a lot to do with the price you pay for your insurance.  Studies done by insurance companies reveal that where you live also has a lot to do with whether you’ll be involved in an accident – whether your fault or not.  Certain areas across the United States are more high-rise, while other are much safer to drive in.

Driving History.  One of the biggest determinants of your auto insurance premium is your driving history.   Do you get tickets or accidents?  Do you have any collision claims?  Comprehensive claims?  Uninsured Motorist claims?  The more activity you have on your driving record, the worse your rate will be.  The good news is that most companies do not look back further than 5 years when determining your car insurance premium.

Marriage.  Being married can often lead to better insurance premiums for most drivers.  Many insurance companies believe that if you are married, there is a much higher likelihood that you won't be driving irresponsibly and at all hours of the day.

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