WHAT DETERMINES YOUR INSURANCE RATES?
WHAT DETERMINES YOUR INSURANCE RATES?
By Tom Black
Serenity Insurance Group
Have you ever moved, changed cars or jobs, only to find that your auto insurance premium jumped? Part of that rate increase could be due to one of many factors that are used to compute your insurance costs.
Where you live-people who live in more rural, or less populated areas within the same state generally have lower insurance costs. The companies figure that being around fewer people makes your likelihood of an accident less.
YOUR AGE-statistics show that people who have more driving experience have less accidents. Young drivers and young males in particular, are many times more likely to be involved in an accident than a person with 10 or more years driving history. (If you are a student, having a good grade average can help lower your premium)
YOUR DRIVING RECORD-the companies hire actuaries who determine your chances of getting in an accident. The more tickets you have on your record, actuaries have shown the more likely you will cause a wreck. Obviously, more serious tickets like Negligent Driving, Reckless Driving, and DUI drive these statistics higher. That is why most companies that will issue an SR-22 filing have higher rates for these high risk drivers.
YOUR CREDIT HISTORY-it may be hard to understand that there is a definite relationship with your credit history and your likelihood to cause or be involved in an accident. Some very scientific men have been able to show a direct correlation between your credit and your costs to an insurance carrier.
YOUR VEHICLE-Some cars or trucks cause more damage to other vehicles when involved in a collision. Some cars or trucks are just involved in more collisions. (Sports cars, hot rods, big SUV’s)
The ideal insurance risk (least likely to be in a wreck) would be a 6o year old married person, living in a farming community, who owns his own home, has no tickets, and drives a 2004 Buick LeSabre.
On the other hand, a very poor insurance risk is the 18 year old young man, living in Los Angeles, who is behind on his credit cards, has four speeding tickets and one reckless driving, and is driving a four year old Corvette.
Keep these things in mind when assessing your insurance costs.
