Top Factors That Determine Car Insurance Premiums
Determining your car insurance premiums is a complicated process that takes time and involves certain algorithms. You should know by now that you can get a car insurance quote online, but this will be only an approximation. It will be more or less accurate, depending on the website you use, the form you use and how honest you are. The best quotes are obtained directly from the company, after they assess your insurability risk. As we just mentioned, determining the premiums is complicated, and involves analyzing multiple factors. Find out the top factors that determine car insurance premiums.
- Demographic factors. Although initially you may look with suspicion and discontent the fact that premiums take into consideration age, gender and marital status, there are good reasons for that. All insurance companies use statistics referring to these demographic factors. For example, teens are considered high-risk because they have the most numerous accidents, when compared with other age groups. The numbers just display the trend. However, some factors like religion and race are not used, because they are usually not quantifiable by police and they are discriminatory.
- The make and model of the car. Of course, the model of the car you drive has a direct impact on your premiums. Insurance companies will use statistics and reports in order to check the safety rating of the car, known manufacturing defects and if they are a favorite target for the thieves. They will also ask if you added aftermarket safety and tracking device or if you have customized the car. Generally, companies do not like customized cars, because the customized parts may be too hard to find when a replacement is needed.
- Your driving history. Understandably, insurance companies pay a lot of attention when checking a potential customer’s driving record. They will look for traffic violations, claims, and of course, recently graduated driver’s education courses. A person with a clean driving record will pay less.
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