5 Factors That Affect Auto Insurance Rates
Are you considering buying a new car or shopping around for a new insurance provider for your existing vehicle(s)? Does the thought of auto insurance rates have you feeling a bit overwhelmed? Every insurance customer has been where you are at one point and understanding how insurance rates are determined will often help relieve any concerns you may have in making a decision.
Like home insurance, life insurance, and commercial insurance; auto insurance, rates are calculated based on an in-depth consideration of many different things. The main factors impacting these calculations tend to be universal. If you are aware of the most significant factors that will be considered during this process, you can get a general idea of what to expect regarding your own auto insurance rates.
Here are five factors that typically have the most significant impact on such rates:
1. Age
When it comes to auto insurance, age is always a major rating factor. Teenage drivers tend to pay the highest premiums, while normally more experienced drivers pay lower premiums. Since drivers of certain ages are statistically more likely to be involved in accidents than others, this risk factor leads to higher-priced premiums.
2. Vehicle
The exact make, model, and year of your vehicle can directly impact your premium rates as well. Typically newer and more expensive cars are more expensive to insure than older lower-end vehicles. The biggest focus here is the potential costs associated with repairing or replacing the vehicle in the event of an accident. It also has to do with the safety standards of the vehicles, typically smaller vehicles result in worse injuries and more damage than larger vehicles.
3. Driving Record
Most car insurance providers look to a driver’s past driving record to form an idea of the type of driver they are. This helps them determine the driver’s risk level. If a driver has a history of speeding tickets, rule violations, car accidents, or a history of cancellations or gaps in insurance, they will likely be deemed a higher risk as there is a greater chance of these incidents reoccurring. Drivers with bad driving records typically pay higher rates, while those with clean records usually stay consistent.
4. Years of Driving Experience
In the eyes of most auto insurance companies, the longer you have been driving, the more experienced you are. More experienced drivers are typically treated as though they pose less of a risk. Therefore, newer drivers often pay higher premiums than more experienced drivers.
5. Location
The place in which you reside can have a significant impact on your auto insurance rate as well. Your rates will likely increase if you live in an area that statistically poses higher risks, such as higher populations. The risk level of your area is determined by various factors ranging from the number of other drivers in your region, to natural disasters and crime rates.
How You Can Save Money on Auto Insurance
If you are looking to obtain a new auto insurance policy, we have great news for you, as there are plenty of ways to save money during this process. If you take advantage of various discounts and policy-bundling methods offered by your insurance provider, you can potentially save some money on your auto insurance.
You may qualify for a multi-line discount if you bundle your home and auto insurance policies together under the same provider. Another great discount offered by most insurance providers is a multi-vehicle discount. If you insure more than one vehicle with the same insurance provider, you may qualify for lower-priced premiums.
Another common way to drop your auto insurance rate is by increasing your deductible, which is the amount you agree to pay for damages before your insurance plan kicks in and begins to pay. If you are confident in your driving skills and you have some money set aside in case of emergencies, then this may be an ideal option for you.
It is also important to remember that you can lower your auto insurance premium rates by using the information provided above to your advantage. Whether that means choosing a “low-risk” vehicle or improving your driving record, you can most likely gain access to lower rates if you reduce your overall risk profile. If you are a new driver, you can lower your initial rates by taking a certified driver’s education course.
Why James Campbell Insurance Is the Best Option for All Your Auto Insurance Needs
Although all of the points mentioned above can certainly have an impact on your auto insurance rates, the biggest factor of all in determining your costs is choosing to go with the right insurance provider.
Few options come close to James Campbell Insurance when it comes to securing competitive auto insurance rates. We ensure our clients receive all of the potential discounts they qualify for. In addition, we try our best to tailor our auto insurance premiums to fit your individual needs.
Not only does James Campbell Insurance offer competitive rates, but we also provide the most reliable services to all of our clients, and we have been doing so for over 40 years. All of our brokers go out of their way to make sure your experience is as stress-free and streamlined as possible while setting up a new auto insurance policy.
Clients are always put first at James Campbell Insurance, and your best interests are always in mind. Whether you are a brand new driver or you have plenty of experience behind the wheel, our team of dedicated brokers will put together an auto insurance policy that is just the right fit for you.
For more information about the auto insurance policies we offer, or to get a quote on a policy, call James Campbell Insurance at 1-833-459-1065 or contact us here.