Understanding Why Auto Insurance Premiums Are Very Costly

Understanding Why Auto Insurance Premiums Are Very Costly
Why Auto Insurance Premiums Are Very Costly

These days, we are all complaining about the high cost of living. It seems that anyone who owns and operates a car is hit by a good deal of bills that require you to struggle with: the cost of buying the car, the fuel costs, the maintenance and repair costs – and the super BIG ONE – car insurance premiums.

If you have not yet verbalized it, without a doubt the obvious question is underlined in your mind: why does car insurance (read cars, trucks, motorcycles, campers and so on) have to be so, very expensive?

Why Auto Insurance Premiums Are Very Costly
Why Auto Insurance Premiums Are Very Costly

The answer to everything related to insurance comes from the sector itself and this is no exception.

“Insurance rates differ from person to person and are based on certain factors,” says a well-known specialist who works in the three states area and is employed by an independent agency. “It all boils down to how much risk you could be a pilot.”

Eight factors that can affect your auto insurance bill

Some of the things that determine how much you pay for auto insurance are listed below.

• What type of vehicle you drive

There is a clear difference between car brands and models in terms of safety. Furthermore, higher-end cars attached to a higher price are more attractive to car thieves and are more expensive to replace; they are also more expensive to repair after an accident.

• Your address

If you live in a place with a higher crime rate, your premium will reflect the risk of theft. If your location has proportionately more car accidents and claims for compensation, it will also affect your premium.

• How you use your car

If you use your car for commuting to and from the workplace or use it for business reasons, you will find that you will have a higher premium than those who drive just to go shopping or for leisure travel.

• If you are a good driver

If you’ve never gotten a driving ticket or you’ve ever been in an accident, you’ll have a lower insurance rate than those with a less pristine driving record.

• Your claim for compensation

If you have previously filed for insurance claims, especially if they have involved large payments, your insurance premium will reflect that. But you may also experience a rate hike if you have only filed compensation claims for incidents in which you are not to blame.

• How old are you

Young drivers, especially boys in the teens, are grouped as riskier drivers because statistics indicate that they show bad driving habits and are involved in and cause many more serious accidents than older drivers. To a lesser extent, sixty-five or more can increase their insurance rates due to age problems that contribute to poorer reflexes, vision problems and more.

• State of marriage

Studies show that husbands and wives are not involved in as many collisions as they are not married.

• Like credit rates

While this may not seem fair to some, insurance companies may classify you as a driving risk because of your poor credit score.

Talking to an expert specialist hired by an independent insurance agency will help you navigate through the network of insurance policies in order to present you with the most personalized one at the most competitive price.

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