How Carriers Determine Your Auto Insurance Premiums

Auto insurance is an essential type of policy typically required by law. But amid uncertain economic conditions, auto insurance is yet another bill in your budget. Understanding how your rates are determined can help you make informed choices and potentially lower your premiums and stretch your dollars further while maintaining sufficient coverage. Consider the following cost factors:

• Location—If you live in an area with high traffic rates or frequent vehicle break-ins, you may need to pay more for coverage.
• Vehicle specifications—The make, model, year and features of your vehicle can impact its risk profile. For example, luxury models may cost more to insure. Meanwhile, cars with advanced safety features or anti-theft devices may garner discounts.
• Driving records—Insurers will likely scrutinize your history behind the wheel and may charge less if you have a clean record with limited or no traffic violations and at-fault accidents.
• Claims history—Going claims-free for an extended period of time can earn you better prices, whereas past claims may incur higher costs.
• Policy details—The coverages you choose to include in your policy (e.g., liability, collision and comprehensive), as well as its deductible and limits, also influence your rates.

If you’re searching for better auto insurance rates, contact us today for a free quote.