How is Car Insurance Really Calculated?
>> Wednesday, February 15, 2012
SUMMARY:
Believe it or not, the amount you pay for car insurance and home insurance is actually linked. Where you live will greatly influence your premium.
If you are driving a car, comprehensive car insurance is an absolute must. Different car insurance providers can supply policies at different prices based on the amount of risk they are willing to take, what type of auto insurance they specialise in, and how hard they are fighting for your business in the marketplace. Insurance premiums can vary greatly from provider to provider, and, over time. It is always worth comparing insurance quotes before you commit to renewing your policy.
At the same time, insurance risk and the way insurance companies calculate their rates is essentially the same; although, as the market becomes more competitive. Here is a solid look at the way they calculate our premiums. The list starts at those factors, which have more influence to less.
• Age and sex. Not surprisingly, accident rates can be directly correlated to sex and gender. Younger males, for example, are the most likely to get into accidents in just about all societies. The insurance companies have years of compelling data to help them determine premiums.
• Your use. Due to increased competition, the amount you use your car is getting more attention than it once used to. More providers are choosing to cover by the amount the car is used, and this can greatly influence your premium. It only makes sense. If you don’t use your car much, you shouldn’t be paying as much as someone who does.
• The location. The suburb where you park your car and drive are strictly related to your policy. Home insurance policies and car cover have this point in common. Car theft is a very big issue for insurance companies, and where you park your car, and therefore: where you live, will greatly influence your premium. Cars get stolen and damaged in some areas more than others and this is judged by official statistics and insurance claim numbers.
• Your driving history. You driving history will greatly influence your premium. How long you have had your licence, how many accidents and fines, and ultimately, how many times you have claimed in the last 5 years is of great importance to insurance companies.
• Credit rating. Believe it or not, insurance companies have research to show if you pay your bills on time, you are less likely to get into an accident. This is how they use your credit rating to influence the amount of your premium.
• Your car. Obviously the make and model, and the year of your car will influence your premium. Any modifications add a considerable amount to a premium. In some cases, the insurance company may not insure you if you have certain car modifications. Again, this data is gathered over time and the insurance companies know which cars are in fewer accidents than others.
You must thoroughly compare car insurance quotes. The market is changing rapidly. Specialist insurance companies for particular car types could mean you are saving huge amounts of money. There is no reason why you cannot get very specific coverage, coverage for distance, and a great deal if you are a good driver with an excellent record. While you are young, and have little experience, driving the safest of cars with a smaller engine is the only real option. Shop around and get the best deal.
Believe it or not, the amount you pay for car insurance and home insurance is actually linked. Where you live will greatly influence your premium.
If you are driving a car, comprehensive car insurance is an absolute must. Different car insurance providers can supply policies at different prices based on the amount of risk they are willing to take, what type of auto insurance they specialise in, and how hard they are fighting for your business in the marketplace. Insurance premiums can vary greatly from provider to provider, and, over time. It is always worth comparing insurance quotes before you commit to renewing your policy.
At the same time, insurance risk and the way insurance companies calculate their rates is essentially the same; although, as the market becomes more competitive. Here is a solid look at the way they calculate our premiums. The list starts at those factors, which have more influence to less.
• Age and sex. Not surprisingly, accident rates can be directly correlated to sex and gender. Younger males, for example, are the most likely to get into accidents in just about all societies. The insurance companies have years of compelling data to help them determine premiums.
• Your use. Due to increased competition, the amount you use your car is getting more attention than it once used to. More providers are choosing to cover by the amount the car is used, and this can greatly influence your premium. It only makes sense. If you don’t use your car much, you shouldn’t be paying as much as someone who does.
• The location. The suburb where you park your car and drive are strictly related to your policy. Home insurance policies and car cover have this point in common. Car theft is a very big issue for insurance companies, and where you park your car, and therefore: where you live, will greatly influence your premium. Cars get stolen and damaged in some areas more than others and this is judged by official statistics and insurance claim numbers.
• Your driving history. You driving history will greatly influence your premium. How long you have had your licence, how many accidents and fines, and ultimately, how many times you have claimed in the last 5 years is of great importance to insurance companies.
• Credit rating. Believe it or not, insurance companies have research to show if you pay your bills on time, you are less likely to get into an accident. This is how they use your credit rating to influence the amount of your premium.
• Your car. Obviously the make and model, and the year of your car will influence your premium. Any modifications add a considerable amount to a premium. In some cases, the insurance company may not insure you if you have certain car modifications. Again, this data is gathered over time and the insurance companies know which cars are in fewer accidents than others.
You must thoroughly compare car insurance quotes. The market is changing rapidly. Specialist insurance companies for particular car types could mean you are saving huge amounts of money. There is no reason why you cannot get very specific coverage, coverage for distance, and a great deal if you are a good driver with an excellent record. While you are young, and have little experience, driving the safest of cars with a smaller engine is the only real option. Shop around and get the best deal.
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