What Factors Affect My Car Insurance Rates

What factors affect my car insurance rates?

Shopping for car insurance can seem like a mystery. You provide certain information to the insurance company and they magically calculate a car insurance rate for you. Understanding the factors that influence your car insurance rates can help you evaluate the insurance quotes you receive and choose the best car insurance policy for you.

" Your driving record - A clean driving record means lower premiums. And, some blemishes on your driving record are more serious than others. For example, a speeding ticket you received two years ago won't have nearly the impact on your premium that a serious accident or DUI will have.

" Where you live - Residents of large metropolitan areas often pay higher car insurance rates than those in smaller towns. High traffic areas indicate a higher likelihood of an accident.

" The number of miles you drive each year - You'll be quoted a higher premium if you drive your car daily, particularly if you have a long commute.

" The value of your car- More expensive cars are, of course, more expensive to replace in the event of an accident. Therefore, the higher your car's value, the more you'll pay to insure it.

" The safety of your car- High speed sports cars always carry higher premiums than heavier, safer cars. The safer your car, the less likely your insurance carrier will have to pay out big claims to another party in an accident.

" The likelihood that you car will be stolen - Your comprehensive insurance covers your car in the event of theft. Some car makes and models are simply more likely to be stolen than others. Those cars that are often the target of theft will carry a higher comprehensive premium.

" Your deductible - The deductible is the amount you pay out of pocket for repairs or replacement in the event of a claim against your insurance. If you choose a lower deductible, your premiums will be higher, and vice versa.

" Your coverage- Liability coverage is required in most states. This coverage protects the other party in the event of an accident that is deemed to be your fault. Other coverage is optional. Collision covers your car in an accident that you cause. Comprehensive covers your car in the event of a fire, vandalism, theft, as well as in the event of damage from wind or hail. Medical payments coverage provides money for medical bills for both you and the other party in an accident, if you were at fault. In addition to these common coverage articles, there are other add on items that might be included in your car insurance rates. Items like rental car coverage and roadside assistance are convenient but not essential.

All of these items are considered when your car insurance rate is calculated. Changes to any one of them can also change your premiums. That's why it's important to understand all the aspects that affect your insurance premiums so that you can get the best car insurance rate for you.