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The world of auto insurance is complicated and premiums payable for a given policy
vary from person to person. Simply put who you are determines how much you will pay
as car insurance premium. Automobile insurers use a large number of risk factors to
compute how much premium is payable by any individual.
Basic factors that determine how much you need to pay for auto insurance are:
1. The age of the driver. Young and old drivers need to pay more
insurance premiums as they are more likely to have accidents than middle aged
drivers. In addition premium payable is determined by the car you drive. If
you drive a sports car or any mean machine then your premium will hit the sky
as compared to a sedan or compact car.
2. The gender of the driver. Insurance companies have determined that
women drivers are not affected by hormone surges or machoness and are so
better drivers than men. Statistically women are proven to be safer drivers
so a woman driver will pay lower auto insurance than a male.
3. Where you live can change your car insurance rate. Auto insurance
companies compute risk by where a car owner resides. Those living in rural
areas or suburbs pay lower insurance premiums than those who live in a city.
4. Safe Driving is a factor that influences your premiums. Most insurers
lower premiums payable for persons who have a safe driving record for three
years and more. So speeding tickets, accidents, parking violations, and running
red lights are all factors that can save you money.
5. Your credit history. Most insurance companies consider an individual
with a good credit history and score as a lower risk and offer lower premiums
on auto insurance. The credit report reflects the fact that you are a
responsible individual and are dependable.
Other factors that can lower auto insurance premiums are: safety features
in a car; anti-theft devices; eco-friendly fuel use; use of car pools and
public transport; exclusive use of vehicle only for personal use and so on.
Insurance companies set premium rates based on factors like make of car, cost
of parts, and sticker price of car. In case an individual updates his driving
skills regularly and follows all safety norms and rules laid by the highway and
road patrols then the insurers offer lowered premium rates.
If you have a membership at the AAA or any other professional body then you
may be automatically eligible for a discount on auto insurance rates. Lately
if auto insurance is bought online the rates are much lower than when bought
through an agent or office. And, different insurers base the premiums on auto
insurance based on their experience so while one may consider the occupation
of the individual a risk another may give more emphasis on whether the vehicle
is used for commercial purposes. The module for calculating risk factors varies
from company to company as also the premium rates on auto insurance.
So it is best to get at least 3-4 quotes from different auto insurance providers
before making a decision.
About Author
Barry Allen is a freelance writer for
Free Insurance Quotes, the
premier website to find insurance quotes including health insurance, home
insurance, auto insurance, life insurance, travel insurance, medical insurance,
insurance company's reports and more.
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