Shopping
for car insurance is frustrating. It’s tempting to get a reduced rate by
raising deductibles or lowering coverage amounts. You might not realize just
how many factors play a role in the price you pay at the end.
Understanding
what factors can affect your insurance rate allows you to make informed
decisions, as well as helping you know how to lower your expenses.
Demographics
You
might be surprised to find that your age, gender, geographical location,
marital status, and credit score
affect your rates.
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Age & Gender
When
it comes to teenagers, statistics show that males have more accidents, so they
tend to pay higher insurance rates. While in later life older women are more
accident prone, thus pay a higher rate than elderly men.
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Location
Most
accidents happen near the home, so the area in which you live plays a big part
in your insurance rate. If you live in a neighbourhood that is more densely
populated, then you are at higher risk of collisions and theft.
For
instance, Philadelphia and Detroit are the most expensive cities to insure
cars, because they have high traffic and lots of uninsured drivers.
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Marital Status
Single
people tend to have more accidents, so for those getting married- their insurance
rate can drop quite a bit. Though, it will depend on your driving history. If
you are a male with a clean record who has never been in accident your
insurance rate could be halved.
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Credit Score
A
lot of insurance companies use
your credit score in determining your insurance premium. The lower your score
the higher the premium.
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Profession
Your
profession and your risk of accident tie in. For instance, if you are a
delivery driver, or someone else that spends a lot of time on the road you are
more likely to be in accident. However, airline pilots, nuns, and paramedics
tend to receive better rates due to the belief they are more careful drivers.
Car Related Factors
It’s
not just you as a person that affects your rate, but also the car that you
drive.
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Safety Rating
The
higher your car’s safety rating the lower your rate could be. The same can be
said for a car with a low safety rating. You will pay more if the insurance
company believes you are at a greater risk of an accident.
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Size
Larger
cars are perceived to be safer than smaller cars in the event of an accident.
So if you have two vehicles with the same safety rating, the larger one will
still be cheaper.
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Theft Rate
Some
cars are more susceptible to theft than others, and if your car is on that list
will result in higher insurance premiums. Having anti-theft features can lower
your premium, though.
Driving Habits
The
most important factors, though, are your driving habits.
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History
If you have a history of tickets, accidents, and previous claims
then you are likely to pay more for insurance. However, if you can keep your
record clean for a few years you will see it drop after three years or so. A
DUI can have an effect on your premium for up to 10 years.
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