You can shop around for the cheapest auto insurance, but there are certain factors that affect the cost of car insurance, regardless of which company you end up using.
It can help to think of it as a kind of game. By developing certain driving habits, you increase your abilities. You get rewarded for those abilities with cheaper car insurance … not to mention the ability to navigate the roads without getting into an accident.
The factors most car insurance companies consider when determining your premiums include:
Your Driving Record
The best way to keep your car insurance premiums low is to maintain a clean driving record as much as possible.
Not only does this mean no accidents, it also means no:
- Speeding tickets
- DUIs (driving under the influence) or DWIs (driving while intoxicated)
- Tickets for other traffic violations such as:
- Running a red light
- Turning without using a turn signal
- Turning from the wrong lane
- Ignoring a Stop or Yield sign, etc.
SR-22 Insurance and SR-50 Insurance
If you need SR-22 insurance or SR-50 insurance, it’s because you’ve already been in an accident and you need to prove you have the minimum amount of insurance legally required by your state.
That history will make it more expensive to provide you with insurance coverage, and the insurance company will pass that expense on to you in the form of high car insurance premiums.
If you need SR-22 insurance for cheap or SR-50 insurance for cheap, we can help.
How Much You Use Your Car
A safe driving record is one thing, but at a certain point, statistics play a role in the chances you’ll get into an accident.
The more you use your car, the more likely you are to get into an accident and file a claim with your insurance, even if you’re a safe driver.
This is why auto insurance companies take into account how much you use your car before determining how much to charge you for coverage.
Location
Just like driving more increases your chances of getting into an accident, driving in high-traffic areas also increases your chances of getting into an accident.
Even if you’re a safe driver, the chances of another car hitting yours increases when you drive in areas where there are more cars on the road.
If you’ve driven in a crowded city and on a one-lane country road, it’s not hard to see why one location is considered riskier than the other, even for safe drivers.
The Type of Car You Drive
An expensive car that gets into an accident costs more to repair or replace than a cheap car.
As a result, one of the easiest ways to get cheap car insurance is to drive a cheap car.
Your Age
The more experience you have behind the wheel, the more likely you are to have developed safe driving habits, especially if you’ve gone a long time without getting into an accident.
You’ve also probably learned how to assess risks when you’re behind the wheel. You have a better understanding of which risks are most likely safe to take, and which risks are unlikely to end well.
As a result, car insurance companies have determined the riskiest drivers to insure are the youngest ones who have the least experience behind the wheel.
That’s why people under the age of 25 generally pay more for auto insurance, with teenagers paying the highest premiums.
Unfortunately, if you’re under the age of 25, there’s nothing you can do about this factor of car insurance premiums. You just have to wait it out.
Your Credit Score
Yes, your car insurance company will check your credit score to determine your premiums.
The theory is that those who are responsible with their money are more likely to be responsible with their vehicle while out on the road.
So pay your debts on time and don’t take out any loans you don’t feel confident you can pay back in full and on time.
Your Gender
Like your age, this is one factor affecting the cost of car insurance over which you have no control.
Statistically, women are less likely to get into accidents and less likely to get a DUI than male drivers. When they do get into an accident, it’s less likely to be a serious accident compared to accidents men get into when they’re behind the wheel.
So, if you’re a woman (especially if you’re a woman over the age of 25) you might get to pay a slightly lower premium than you would if you were a man.
Higher Coverage
An important factor in controlling your insurance premiums that doesn’t get a lot of attention is how much coverage the insurance policy provides.
For example, one way to lower your premium is to raise your deductible, meaning the amount you have to pay before the insurance takes over.
Alternatively, you can choose an auto insurance policy that provides less coverage in order to pay a lower premium.
Each state requires every driver to maintain a certain amount of insurance coverage, although the limit varies from state to state. For example, in Illinois the law requires drivers to carry at least enough insurance to cover $25,000 worth of bodily damage to one person, $50,000 for two people, and $20,000 worth of property damage per accident.
But if you get into a serious accident and cause more than $20,000 worth of property damage, or cause one or more people to go into the hospital for an extended period of time, you can quickly blow through that limit, at which point you’ll be on the hook to pay for the rest yourself.
You can buy an insurance policy that covers more than the legally required minimum, but it will cost you more upfront.
Working Towards Cheap Car Insurance
The thing to remember about all the above factors is that there is no single deciding factor in how much you pay for auto insurance.
Insurance companies look at a variety of factors and take them all into account when determining how risky it is to insure you. Only once they have looked at all the relevant factors and made their conclusion will they decide how much to charge you for your insurance coverage.
This is good news if one or more of the factors beyond your control don’t work in your favor because you can always work on practicing safe driving habits and maintaining a clean driving record.
Remember to gamify your driving so you can level up. The longer you do, the lower your insurance premiums will get.
At Accurate Auto Insurance, we work with you to help you get the cheapest auto insurance coverage possible. Get your free quote today.
