What Can Influence Your Car Insurance Premiums?

DID YOU KNOW? You could be overpaying for your car insurance, or at least paying for coverage you no longer need. 

Rates can vary across insurance companies and are dependent on changing factors, so taking time to compare and use an independent broker can work to your benefit if you want the best auto-insurance premiums.. 

And while it’s easy to focus on price, it’s important to know that there’s a lot more to an insurance quote than how much it’ll cost you. You’ll want to also pay attention to what the policy will and won’t cover, your coverage limits, and what your out-of-pocket cost will be if something happens to you or your car. 

What can influence car insurance quotes?

While it varies by insurance company, there are commonly known variables that influence the price you pay.

• Driving Record: Having a good driving record can help you get a lower auto insurance rate. If you’ve had accidents or serious traffic violations, it’s likely you’ll pay more. Newer drivers may also have to pay more because they’re more of a risk on the road.

• Type and Amount of Auto Insurance Coverage: The types of coverage you choose and the limits and deductibles you select for each type of coverage will play a role in the cost of an insurance policy.

• Location: Where you live plays a role in your auto insurance rate. Drivers who live in higher crime or urban areas, seen as more susceptible to vandalism, theft, and accidents, are likely to pay higher rates than those living in rural areas.

• Age: Younger drivers tend to have more accidents than drivers with more experience. If there are teenagers or people under 25 on a policy, insurers will usually charge more. 

• Car Value: The value of your car is a big factor in the cost to insure it. If you buy a more expensive car, the insurance on it will likely be higher because it’ll cost more to replace or repair. Often, insurance companies will offer discounts if your car has high safety ratings or high-tech safety equipment.

• How Much You Use Your Car: Insurance companies will consider how much driving you do on a regular basis when calculating a quote. The more you’re on the road, the more likely you are to get into an accident. You’ll likely pay more if you drive your car often or use it to commute long distances. If you drive only occasionally, you’ll likely pay less.

• Insurance-based Credit Score: In many states, insurance companies are allowed to use a factor that’s similar to your credit score called a credit-based insurance score. It’s a tool that uses specific elements of a person’s credit history to predict how likely they are to file a claim.

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