Understanding Why Auto Insurance Premiums Are Very Costly
These days, we're all complaining about the high cost of living. It
appears as if anyone who owns and operates an automobile is hit by a
good dose of bills that require struggling with: the cost of purchasing
the car, fuel costs, maintenance and repair costs - and the super BIG
ONE - auto insurance premiums.
If you haven't yet verbalized it, no doubt the glaring question is
underscored in your mind: Why does car (read car, truck, motorcycle, RV
and so on) insurance have to be so very, very expensive?!
The answer to anything related to insurance comes from the industry
itself and this is no exception.
"Insurance rates differ from person to person and are based on a few
factors," says a noted specialist working in the Tri-State area and
employed by an independent agency. "It all boils down to how much of a
risk you as a driver may be."
Eight Factors that May 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 makes and models of cars in regard
to safety. Moreover, higher-end cars attached to a bigger price tag are
more attractive to car thieves and are more expensive to replace; they
are also more expensive to fix after an accident.
• Your Address
If you live in a place that has a higher crime rate, your premium will
reflect the risk of theft. If you locality has proportionately more auto
accidents and submitted claims, it will have an effect on your premium
as well.
• How You Use Your Car
If you use your car for the commute to and from the workplace or use it
for business purposes, you'll find that you will have a higher premium
than those that drive just to go to the grocer or for leisure trips.
• If You Are a Good Driver
If you never have gotten a driving ticket or never been an accident, you
will have a lower insurance rate than those who have a less pristine
driving record.
• Your Claims Record
If you have previously filed insurance claims, especially if they have
resulted in big payouts, your insurance premium will reflect that. But
you may also find a rate increase if you have only filed claims in
regard to accidents where you are not at fault.
• How Old You Are
Young drivers, especially boys in the teen years, are grouped together
as riskier drivers because the statistics say they display poor driving
habits and are involved in and cause many more serious accidents than
older drivers. To a lesser degree, those sixty-five and older may find
their insurance rates up due to age matters that contribute to poorer
reflexes, eyesight issues and more.
• Marriage Status
Studies show that husbands and wives are not involved in as many
collisions as those who are not married.
• How Your Credit Rates
Though this may not seem fair to some, insurance companies may class you
as a driving risk due to your poor credit score.
Speaking to a knowledgeable specialist employed by an independent
insurance agency will help you navigate through the web of insurance
policies so that you are presented with the most tailored one at the
most competitive price.
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