Car insurance is a crucial form of service that has never offered a “flat-rate” type of approach! Many factors affect what car insurance rates you’ll pay, including your very personal information and specific details about the vehicle you’re driving. Today on the Alexander Agency of St Charles blog, we will explain some of these factors and help you begin the journey to obtaining a feasible rate. The following are a few of the factors that determine your insurance costs, ultimately governing how much you’ll have to set aside each month for payment.

Your Vehicle’s Make, Model, and Age:

The age and type of vehicle you drive impacts your cost of car insurance, as the companies that provide you coverage are always keeping in mind what their average cost of claims will be. Later models with new technology and safety features are quite convenient, but they also cost more to repair or replace. The “bells and whistles” that can make for a better driving experience can be more costly. A sports car’s performance can prove to be a bit riskier, so it has a more expensive policy. The Dodge brand has long been known to have the highest car insurance costs, with Mazda leading the opposite end as the lowest. 

The Driver’s Age:

Age has a great impact on car insurance premiums, as it can be a very defining factor of daily driving behavior. Motorists under the age of 25 or over the age of 75 fall into predetermined categories that carry a burden of risk. Younger drivers with less experience have proven to be statistically more likely to make mistakes or take unnecessary chances while driving, and older drivers have proven to be more accident-prone after the age of 70. While it does not feel fair to be “lumped into” these categories, the daily traffic dockets, unfortunately, tend to lean in these speculations’ favor.

Location:

Where you are driving and where the car sits overnight greatly affect your insurance rates, with larger cities bearing the brunt of the risk. More drivers on the road lead to an increased likelihood of collisions, along with more outright theft and vandalism of vehicles. The lack of protected and covered parking leaves cars vulnerable to damage, with your state or residence influencing your insurance prices. Heavy snow and inclement weather can tend to push claim statistics up, with states such as Michigan, California, New York, and Connecticut being some of the most expensive. 

Driving Record:

The ability to produce a clean driving record is one of the best ways to save money on your auto insurance. Many providers will offer a sizable discount for good drivers or those without any claims on their record. While insurance companies do recognize that accidents can happen at any time, some very intense moving violations rank higher in terms of risk. A ticket or accident will usually affect your record for 3 to 5 years, with serious violations such as DUIs impacting you for much longer. A speeding violation for just 5 mph over the limit can increase your insurance average by nearly 400$ annually. 

Gender:

The gender listed on your driver’s license will also affect your car insurance costs. Men tend to pay higher premiums because they are more likely to hurry and take risks while behind the wheel. Some states such as California and Hawaii will not use gender as a factor during the rate determination process, but Missouri can tend to do so. While sometimes not as high a factor as driving record and credit history, gender is still one element that can work for or against you.

Marital Status:

In every state besides Massachusetts and Michigan, your marital status greatly impacts how much you’ll pay for car insurance. A married driver will see a lower cost than those who choose to remain single. This really boils down to ratings and discounts. Insurance companies have always viewed someone who is married as safer, and less likely to engage in hazardous behavior or take risks while driving. Since couples can double up on assets and savings, insurance companies are likely to see married people as more financially stable. Drivers who are married are also able to qualify for more multi-vehicle discounts.

Credit History:

In most states, your credit history will also be considered when insurance providers are calculating your final insurance premium. Insurance companies look at your credit history much the same as your driving history. Drivers with lower credit scores are historically proven to take chances behind the wheel and are unfortunately considered high risk. While Oregon and Utah regulate the specifics of how credit scores are used by insurance companies, Missouri insurance providers will closely gauge this information while making their decisions.

Claims History:

Every single issue and attribute within the insurance realm is risk averse, and a history of long claims will cause your premium to be much higher. The amount of time and amount will vary by company, and level of claim. Even claims you were not ultimately found at fault for can lead to an increase in your premium, because of the way that pools payout when it’s time to reimburse the customer. Many insurance companies will offer accident forgiveness if it’s your first fault accident which is a huge benefit. Without this motion, claims will usually stay on your record for around three to five years.

Deductible:

Many of the factors that go into reading your car insurance are beyond your control, but there is one you can directly impact. The higher the deductible you choose, the lower your insurance rate will be. I need to file a claim. You would want to know how much you could afford to pay without putting a huge dent in your monthly finances. The best way to choose your deductible is to put any money you save on your premium into savings to be prepared if it ever comes time to pay your deductible quickly.

A Committed & Connected Staff for a Complex Choice:

Choosing the right insurance can seem a bit daunting at first, as the different options take time to look over. Although you now have a good understanding of what goes into creating your premium, there are still other things to consider when choosing what works for you. Connect with us here at the Alexander Insurance Agency of St Charles today to add clarity and guidance to the mix: we can secure the premium and diverse protection that you deserve!