How My Auto Rates are Determined

Learn how your auto insurance rates are calculated.

Have you ever wondered how your auto insurer calculates your rates? When determining your premium, your insurance provider takes into account a wide range of individual factors. Curious to learn about some of the factors that they are considering? Here are some of the things they will include in their calculations.

A car insurance carrier considers many factors when evaluating risk, including:

  • Age.
  • Gender.
  • Location.
  • Vehicle type.
  • Marital status.
  • Accident history.
  • Driving record.
  • Annual mileage.

These factors help insurers form a composite look at their customers, and evaluate which ones are most likely to cost them money through higher-than-average claims rates. Those deemed most likely to file a claim from an action they caused get tagged with higher insurance premiums.

Like it or not, that’s how the system works.

Who Gets the Cheapest Car Insurance Rates?

Generally speaking, insurers offer cheaper car insurance rates to those who:

  • Are female.
  • Are over 25 years old.
  • Are married.
  • Drive an older, less expensive car.
  • Drive a car with a good safety record.
  • Live in a rural area.
  • Have no chargeable accidents.
  • Have no moving violations.
  • Meet insurance low mileage standards for your state.
  • Have a high credit score.

Drivers with these characteristics have been shown to – on average – cause fewer accidents, report fewer claims, and cost insurers less money. That’s why those who fit into most of these categories pay a cheaper car insurance rate than other drivers.

However, insurers don’t weigh these factors equally. For instance, your driving record, age, and gender are more important than your marital status or credit score.

How to Lower Your Car Insurance Rate

When it comes to lowering your premiums, you have a lot of options.

Not all of the following actions may be feasible or possible for you, but they can have a positive influence on the price you’ll pay for insurance:

  • Increase your deductibles.
  • Combine your policies (Home & Auto).
  • Take a safe driving course.
  • Maintain a high grade point average.
  • Have the newest safety features in your car.
  • Drive a vehicle with a good safety record.
  • Improve your driving record.
  • Have fewer chargeable accidents (i.e., accidents you caused).
  • Move to a more rural location.
  • Drive fewer miles.

 These are some of the factors that your auto insurer will take into account when calculating your rates.  Do you have further questions regarding your auto insurance coverage?  Then don’t hesitate to contact the professionals at Stromsoe Insurance Agency in Murrieta, California.  We are always ready to assist you with your coverage needs.

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