Factors that Affect Car Insurance Rates

Factors Affecting Your Car Insurance Rates: Car insurance rates are not fixed; insurers consider many factors before setting prices. If you are car insurance shopping, be aware of the factors that will influence the rates you will be getting.

Key Factors Affecting Your Car Insurance Rates

This article will reveal the factors affecting car insurance rates. Keep reading to get the information you need.

Key Factors Affecting Your Car Insurance Rates

As earlier stated, insurance rates do not come at a fixed price. Car insurance rates from one company can differ from another for the same insurance coverage because of the factors affecting it.

Here are some of the main factors influencing car insurance rates:

  • Credit Record
  • Driving History
  • Deductible Amount
  • Coverage Selections
  • Car Make and Model
  • Personal factors
  • State Requirements

Some of the factors can be controlled, such as your driving history and record; other factors, like your age and gender, cannot be controlled.

Driving Record

Your driving record refers to your attitudes towards driving, it describes how well you have been driving to the rules and regulations of driving.

Driving record is one of the biggest factors that determine your car insurance rates because insurance companies tend to look at your driving history for the past five years or two years, depending on the state

You have a clean driving record when you have not violated the rules of driving or had at-fault accidents alongside a DUI/DWI conviction.

If you have violated the driving laws and have had at-fault accidents, you will be considered a highly risky driver who is accident-prone.

Highly risky drivers will be charged more for insurance rates or even denied coverage by some companies; however, this factor can be controlled by drivers.

Drivers with bad driving records can practice safe driving habits and improve their driving. No matter how long it takes, they can improve their driving record which will go a long way to influence your future insurance rates.

Driving History

Driving history refers to how long you have been driving and how well you have been driving. If you have been driving for a long time, you will be seen as an experienced driver, and you may charge less.

However, if you are a new driver without experience, you tend to be charged more for insurance because there is no information to evaluate.

If you also went a long time without having car insurance, it is referred to as a coverage gap. Which can also cause high insurance rates because your history cannot be determined.

Deductible Amount

Deductible refers to the amount of money you pay off your pocket when a claim is filed for repair or damage bills.

You can choose the amount to pay for your deductibles ranging from $250 to $2,500, however, the higher you pay for deductible the less your insurance rates will be.

Coverage Selections

The coverage you choose also has a massive impact on your insurance rates. However, you are advised not to go for the cheapest coverage but for the type that suits your insurance needs.

You can opt for your state’s minimum requirements if you are on a budget or go for full coverage car insurance.

There are several coverage types and they all cost different prices, they include liability car insurance, uninsured motorist insurance, collision, and comprehensive coverage.

There are other coverage options you can opt for, such as gap insurance, roadside assistance insurance, rental reimbursement insurance, and accident forgiveness insurance.

The insurance coverage you choose significantly determines the amount you pay for insurance.

Car Make and Model

The type of car you drive can also play a massive role in your car insurance rates. The insurance companies will consider what it takes to repair such vehicles and the rate at which it is being stolen and vandalized.

For example, insuring a truck is much cheaper than insuring a sedan on average; therefore, the prices cannot be the same.

Personal Factors

There are car personal factors that affect your car insurance rates that cannot be controlled, such as your age, older drivers are considered to be more experienced and thus may get it cheaper.

Your gender can also affect your insurance rates; men are seen to be more risk-oriented and more likely to cause an accident and, as such, will tend to pay more for insurance, unlike women.

Your marital status also influences your car insurance rates, married drivers are seen to have very good credit history and will not be charged more for insurance than single, divorced, and separated drivers.

State Requirements

The state you reside in can also greatly affect your car insurance rates, as each state has its own laws. They have different minimum requirements, which could vary in price.

The more coverage you are required to buy, the more expensive your insurance policy may be.

Other factors affect your car insurance rates, and they will be listed below:

  • Zip Code
  • Yearly Mileage
  • Occupation
  • Education
  • Economic Factors
  • Home Ownership


Can My Car Insurance Rate Change?

Yes, it can. You have to work on the things that made it expensive, such as your driving history, and you can increase your level of driving experience. However, you can also work on your driving record by practising safe driving. You can choose lesser coverage types, you can work on your factors, and so on.

How do I Lower My Car Insurance Rates?

You can lower your car insurance rates by doing the following:

  • Reduce your mileage
  • Raise your deductible
  • Lower your coverage
  • Check for discounts
  • Shop for a new policy

How do I Save on Car Insurance?

You can save on your car insurance prices when shopping by doing the following:

  • Drive carefully
  • Consider a high deductible
  • Build your credit
  • Choose your vehicle well
  • Ask for discounts
  • Take defensive driving courses

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