by Barry Allen
Auto Insurance premiums are never computed on a flat rate. The premium payable by each individual varies and is dependant on several variables. There are several factors that are used by auto insurers to determine the premium payable for auto insurance coverage.
Auto Insurance premiums are never computed on a flat rate. The premium payable by each individual varies and is dependant on several variables. There are several factors that are used by auto insurers to determine the premium payable for auto insurance coverage.
The rate of vehicle insurance is arrived at after taking into consideration the following:
1. Your age. Generally younger drivers are considered to be high risk and so the insurance rates are higher. Similarly older drivers too pay higher auto insurance premiums as with advancing age eyesight and coordination may become problems that affect driving.
2. The make of your car. Most insurance companies tabulate auto insurance rates based on the make of the vehicle. Compact cars and sedans have lower rates while sports models, exotic cars, and SUVs are assigned high rates of premium.
3. Gender is a factor too. Females get lower rates of auto insurance while males pay higher auto insurance premiums. Male drivers are consider high risk individuals as compared to females. According to statistics more accidents are caused by men than women drivers.
4. Financial stability. Auto owners with great credit scores and credit reports generally pay lower premiums than those with bad credit scores and reports. If you are considered to be a dependable individual then insurance companies offer lower premium rates.
5. Driving records have a say in premiums payable. If a driver has a clean driving record for three consecutive years then auto insurance providers will happily extend policies with lower premiums.
6. Where you stay. Those who live in the city pay more than individuals who live in the country or suburbs. Areas with lower crime rates and less congestion attract lower auto insurance premium rates. So if you live far from the maddening crowd then you will benefit by paying much lower premiums.
7. How many insurance policies you hold. If you approach for auto insurance the same insurance company that has you covered for life, health, hone and so on then you would automatically be eligible for great discounts on premiums payable for an auto insurance policy. Since the company already knows you and you have established credibility with them you will receive better rates as the insurers know what amount of risk you represent.
8. The condition of the car will be considered before offering a policy. The make, how old the vehicle is, its maintenance, and so on. A car in prime condition will get better premium rates than a rattletrap.
9. The distance traveled per year. If you restrict the number of miles traveled then you will be able to get auto insurance at lower rates. To do this you need to walk, use public transport, and car pool. Similarly a car used only for personal purposes will warrant lower premium than one used for business travel.
10. Whether or not you are eco-friendly. If you care for the environment and drive a non polluting vehicle then the auto insurance premiums will be lower. Auto insurers weigh the pros and cons of several factors before offering a viable premium rate. As a vehicle owner you can make an effort to lower your premium payable by keeping in mind all the factors that will affect your auto insurance premium. Most important always compare quotes from different auto insurers before deciding on a policy.
