There are plenty of
factors that affect your car insurance. Some of them you can alter, while some
you have little or no control over. In most cases, car insurance providers use
factors such as your driving history and zip code to determine if you can get the cheapest car insurance for you.
To help you gain a
better understanding of how your premiums are calculated, here is a list of
five factors that affect your car insurance rates.
Your age has a big
impact on a lot of your driving factors, but it will certainly get you cheaper
insurance as you age. Younger drivers are more prone to accidents and thus pay
higher premiums. Young drivers can mitigate these higher premiums by maintaining
a good driving history, refraining from speeding, and looking for discounts
such a good student and good driver discounts.
On the other hand,
senior drivers may pay more than their younger counterparts. Men and women
under fifty will likely pay less than those over sixty-five. Check which
companies are good for senior policies and look for other discounts like
military service and customer loyalty.
Believe it or not,
your ZIP code has a lot to do with your insurance premium. Each state has
different minimum requirements for its drivers, so where you live will often
help you determine your insurance needs. Learn what the requirements are for
your state and then you will be able to determine how much extra coverage you
will need to purchase.
Depending on where you
live, you may spend more for insurance if you drive more miles than average,
drive at peak times, or live in an urban area where vandalism and theft are
more common. High-risk areas and situations will heighten your chances of having
an accident or needing to file a claim. This, in turn, will spike your premium.
Moving isn’t always an
option, so check for a good driver or good student discounts if you live in
3. Marital Status
Married drivers save
more on average than single, divorced, or widowed drivers. This is because
married drivers are assumed to share driving duties, resulting in fewer
Gender also plays a
role in your insurance premium. Men tend to pay higher premiums than women and
younger men will have more expensive car insurance than younger women.
4. Driving History and Credit Score
Your driving history
is likely the most important factor in how much you’re paying for car
insurance. The better your driving history and the fewer accidents and traffic
violations you’re involved in, the better rate you qualify for.
Roughly three years
after a violation or accident, you can expect your rates to go down. You can
also improve your driving record by avoiding speeding and using your phone
while driving, slowing down in general, and easing up on your braking and
Your credit score is
also a factor. Since drivers with higher credit scores tend to be better
drivers, you will see significant discounts if you can raise your credit score.
Drivers with lower credit scores can expect higher premiums and may be required
to pay upfront.
Some states don’t
factor in credit score in calculating premiums, so check your state’s
regulations. However, chances are you can get a better deal with a better
credit score. You can improve your credit score by paying bills on time and
paying off lines of credit,
5. Claims History
If you have a long
claims history, expect to pay more for your premiums. Also, you can expect your
rate to increase after a claim. Many companies now offer accident forgiveness
so your rates won’t be raised after an accident, but you will likely need to be
with a company for a few years to qualify. Double-check your policy before you
switch. Accident forgiveness is a reason to hang on to your current
The Bottom Line
These are not the only
factors influencing your car insurance quotes. Be sure to gather all your
information before you begin to compare policies. Remember to look at more than
price. You don’t want to end up with less coverage than you need because you
went for a cheaper premium.
Also, have a list of
all the discounts you might apply for and keep bonuses like accident
forgiveness in mind.