People often wonder what car insurance pricing factors insurance companies use to determine the cost of their auto insurance. Most people wait until they purchase a car to find insurance for it. They might even shop around trying to find the best rates.
Many cost factors for car insurance are related to buying a car. They determine how much you are going to pay for your monthly premiums. After you purchase that car, you may find there’s little you can do to influence the quoted price.
To understand the cost of car insurance factors, it’s important to take a look at what determines your premiums. You might discover different insurers use slightly different ranges for the numbers attached to each of the following aspects. That’s why it’s important to consult a qualified agent to compare quotes with multiple carriers to help find the best price. The prices may not vary greatly but there may be one that stands out on both price and coverage.
You monthly premiums and car insurance costs are determined by these primary car insurance pricing factors:
- Age
- Gender
- Marital status
- Geographic location
- Driving record
- Credit score
- Vehicle model
Influencing Statistics Used by Car Insurance Companies to Calculate Premiums
Insurance companies also statistical analysis on past claim histories for different models of cars. They specifically consider these cost factors for car insurance to calculate premiums:
- How much damage a particular model of car typically incurs in a crash
- Whether that model is more likely or less likely to be targeted by car thieves
- Whether that car model cause more damage or less damage to other vehicles when involved in an accident
- How much damage that model causes to the people and possessions in the other car involved in the accident
- Whether that model generally has lower of higher claims regarding bodily injury
What You Can Do to Lower Your Car Insurance Premium
Work with your agent and even call to discuss your anticipated car purchase with them before you purchase. They know what determines the cost for car insurance. With their guidance, you may be able to find a model that is more affordable to insure.
Your agent is knowledgeable about the different insurers and can get you multiple quotes to find the best rate.
If you don’t have your heart set on a particular model, consider buying a car with one of the lower price tags. High-end cars always lead to higher insurance costs.
Make sure that you have a good credit score. If you don’t have one that is at least 600 or 650, try to get it up prior to buying your vehicle. A higher score can help you get better insurance rates and lower loan interest rates.
Sometimes the secret to finding a low auto insurance rate is finding the right car. In addition, your driving record, age, gender, and even credit score can affect your rates. If you’re budget conscious talk to your insurance agent before you buy. They could help you save money on your premiums by making a wise choice.
If you have questions or need help with your auto insurance call 800-392-6532
Additional resources: What determines the price of an auto insurance policy?
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