We bet you’ve wondered how car insurance premiums are calculated. Do you ever have discussions with friends of similar age and driving history and find you’re all paying very different premiums for what would appear to be similar coverage?
Insurance premiums are based off of many factors, all of which play a role in your total premium for your auto insurance. A single difference of any of these can give dramatically different outcomes. Some factors insurance companies use to calculate premium can include:
- Gender, age & marital status
- What’s your past driving history?
- What’s your claim history?
- Your Zip Code where the vehicle is garaged
- Your credit score
- How many miles you commute
- Will you or do you have other policies with the same insurance carrier such as home or renters insurance?
- Are you currently insured?
- What types of overage do you want? What limits?
- What limits did you have on your previous insurance policy?
- Type and age of vehicle being driven (think safety equipment)
Insurance companies do their best to determine a premium for your situation and calculate a premium that will be profitable for them. It may surprise you to know that many insurance companies try to earn just a few cents on each dollar of premium they collect.
While it is impossible to guess what you are going to be paying each year, you can improve your odds of getting a great rate and terrific coverage by calling a local independent insurance agent. Independent agents represents multiple insurance companies, so we can provide you with comparison quotes from several of the top insurance companies in your state.
How Can I Lower My Car Insurance Cost?
Save when you bundle.
Insurance carriers tend to give great discounts when you bundle your auto insurance with your home/renters/other lines of insurance. Need to insure several vehicles? Multi-policy discounts could earn you some substantial savings. Ask your agent!
Don’t drive much? Seek a low mileage discount.
If you drive less than 10,000 miles a year, ask your agent if you qualify for a discount.
Choose a higher deductible.
If your finances allow you to pay a higher deductible in the event you have a claim, you could save money by making this switch.
Ask your agent about other discounts. Do you qualify for any?
- Paying your insurance coverage in full
- Paperless option
- Safe driver (accident free)
- Electric or hybrid vehicle owner
- Great credit score
- Good student
- Higher education
- Advance quote
Did you experience a higher premium at renewal?
Reach out to your agent and ask to get a re-quoted on your policy. Since we can quote many top-rated insurance carriers, you can likely get same or similar coverage with a new carrier to save money. Life changes, so can your insurance company – but you don’t need to change your agent.