Your auto insurance premiums are based on many different factors that are combined together to create a distinct level of risk. With all of the factors put together, your insurance agent can determine, with some degree of accuracy, what your potential level of risk will be. Let’s discuss these factors.
Factors That Affect Your Auto Insurance Rates
The following risk factors are all used to assist in the calculation of auto insurance premiums.
- Age and Gender
Your age and gender will play key roles in how your auto premiums are figured. Younger males tend to be more reckless behind the wheel than older females. If the insured is a student, their grade point average may be considered as well.
- Marital Status
Marital status has also been shown to be a good factor in determining risk. Men and women who are married tend to be more careful when they are behind the wheel, especially if they have children. Even single people with children tend to drive more responsibly.
- Where You Live
Where you live says a lot about your level of risk. If you live in a gated community, your rates will be lower than if you live in a high-crime area. If you have a garage to park in, that will also lower your premiums.
- Credit Score
A good credit score indicates financial responsibility. The higher and more stable your credit score, the lower your auto insurance premiums will be. If you have been working on rebuilding your credit, you may begin to see a gradual improvement in your rates.
- Your Profession
Your occupation says a lot about the level of risk you take while you are on the job. The riskier your job, the higher your auto insurance premiums could be.
- Safety Rating
Many insurance companies provide their customers with beacons that help to determine a driver’s safety rating. The better your safety rating, the more affordable your auto insurance premiums.
- Size of Your Vehicle
If you drive a small sports car, you are more likely to drive at a faster speed. Driving a four-door sedan or SUV is more common with married couples. Larger cars are thought to be more responsible.
- Age of Your Car
An older car will cost less to insure. Newer cars are often more expensive due to advanced technology and higher price tags. Unless your car is considered an antique or vintage, an older car should be fairly affordable to insure.
- Risk of Theft
If you live or work in an area where car theft is common, your auto insurance rates will be much higher than if you live in a safer community. Having a security system installed in your car will lower your premiums.
- Driving History
Safe drivers with no accidents or tickets will have much lower rates than drivers with multiple infractions or accidents. Your insurance company may look back three years or more when looking for any tickets or accidents.
- Driving Activity
Your driving activity involves how far you drive to and from work and any short trips you may take to go shopping or for recreational activities. Any frequent trips you take will also be included.
Get the Best Auto Insurance with Leland Smith Insurance
Insurance agents are always being asked about what factors are used in determining their auto insurance premiums. Contact the agents of Leland Smith Insurance Services if you want to learn more. Our agents can explain the process that determines how your auto premiums are calculated.