Americans love their cars but aren’t necessarily crazy about their auto insurance rates. What few people realize is that the price you pay for coverage is a direct result of who you are and what you do.
The first factor impacting rates is your choice of automobiles. That red-hot sports car you’ve been dreaming about is going to cost a lot more to insure than the economical and sensible sedan. That’s because the sports car is on every car thief’s “must have” list. The higher the probability your car will be stolen, the higher the cost to insure it.
Your neighborhood is another variable in the rate equation. If you live in an area that is known to have frequent occurrences of accidents or vandalism, your insurance premiums will reflect that. Because more cars are damaged in urban areas than in rural areas, you can expect to pay more for insurance if you live in a large city.
The third consideration is your driving duration and frequency. The more you drive, the higher the probability you will be involved in an accident. Drivers who are long-distance commuters pay higher rates than people who live within close proximity to their jobs. This is also a boon for the Sunday Driver because if you car usage is confined to occasional recreational use, you will pay less than someone who uses it to commute to work daily.
Other important factors include your age, sex, marital status and driving record. Age matters to insurance companies because statistically, drivers under 25 years of age tend to be accident-prone. This is an area where the girls have it over the boys because men are considered greater risks as drivers regardless of their age. Also, married people are considered more stable than singles, so their premiums are lower. Spotless driving records will pay off when looking for car insurance because carriers will reward a safe driver.
There are some things you can do to make sure you get the best rate you are entitled to. Start with the cardinal rule of any purchase: “Thou shalt comparison shop.” Compare not only the rates from several companies, but also the coverage they provide before making your final decision. The other question to ask is what kind of discounts are offered. Insurance carriers can reduce premiums for good students, insuring more than one car, or commendable driving records.
When you’re car shopping, consider buying a model that fits the insurance companies’ profile of the most risk-resistant. Insurance companies know what kinds of cars frequent auto repair shops and which ones are the most coveted by thieves. Avoid these models, no matter how much they call out to you to buy them if you want to keep your rates down.
Finally, consider carpooling or using public transportation to get to work. It’s certainly a good idea environmentally, and the less you use your car, the lower your premiums.
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