If you own a car, auto insurance is not just an option, it’s a legal necessity. If you are in an accident or have your car stolen, having the right kind of auto insurance can help to ease a very difficult situation. As your local insurance advisors, our job is to ensure that you are properly protected -- and we take that responsibility very seriously. However, you might be curious as to how the insurance companies come up with the price of your auto policy.
Here are the primary factors that influence the price you pay for auto insurance...
- Your driving record: The better your record, the lower your premium. If you've had accidents or serious traffic violations, you will pay more than if you have a clean driving record. You may also pay more if you haven't been insured for a number of years.
- The number of miles you drive each year: The more miles you drive, the more chance for accidents. If you drive a lower than average number of miles per year, less than 10,000, you will pay less. For instance, some companies will give discounts to policyholders who carpool.
- Where you live: Insurance companies look at local trends, such as the number of accidents, car thefts and lawsuits, as well as the cost of medical care and car repair.
- Year Licensed: In general, mature drivers have fewer accidents than less experienced drivers, particularly teenagers. So insurers generally charge more if teenagers or young people below age 25 drive your car.
- The car you drive: Some cars cost more to insure than others. Variables include the likelihood of theft, the cost of the car, the cost of repairs, and the overall safety record of the car.
- The amount of coverage: Of course, like anything else, the more coverage you have, the more you pay. However, you may qualify for discounts.