No matter who you are or where you live, car insurance is a must-have. If you want to drive your car you need to have car insurance to help protect yourself, your family, and others on the road. Car insurance is a monthly fee that you pay a car insurance company to protect you in case of an accident. Accidents are completely unpredictable so it is crucial that you always have up to date car insurance. If you are shopping around for new car insurance you should fully understand the different factors that may affect the rate that you pay for your car insurance.
One of the main factors that can affect your car insurance rate is the geographical location that you live in. The location you live greatly affects the rate that you will pay for car insurance. For instance, if you live in New Jersey your car insurance will be much higher than if you live in Maryland. The state that you live has different taxes and regulations about the car insurance you must carry and maintain. Since some states are more populated and have more accidents on a yearly basis cheap car insurance companies may charge higher rates for drivers in different states.
Your age is another factor that greatly affects your car insurance. If you are a teenager or an elderly person your car insurance rate will likely be much higher. Since these age groups are much more likely to get in accidents, car insurance companies charge higher rates to protect themselves. If car insurance companies know that teenagers and elderly populations are more at risk of getting into an accident they are more likely to make them pay higher rates. Other populations will likely have lower rates because their age group is less likely to get in accidents.
3) Claims History
Your claims history will greatly affect your car insurance rate. If you have a previous claims history of many accidents the car insurance company will assume that you are a risky driver and will likely get in more accidents in the future. This will increase the rate that you have to pay. If you do not have a claim history or have a claim that was over five or ten years old the car insurance company will presume that you are a safe driver and will cut you a break on the fees you have to pay.
4) Type of Insurance
The type of insurance you want is another main factor that affects your car insurance. If you want your car to be fully covered and repaired with all new parts your car insurance will be higher than if you only opt to have partial coverage for the other person’s car. For example, if you fully own your car and it is an outdated model it may be more cost-efficient to have partial coverage. This would lower your monthly payment but would not cover your car in case of an accident.
5) Years of Driving Experience
The amount of time that you have been driving will also affect your car insurance. If you are an experienced driver you will not need to pay as high of rates as new drivers. The more experience you have, likely the safer you are in the car. Those with more experience are better able to handle difficult situations and predict what will happen on the road.
6) Driving Record
Your driving record will also affect your car insurance. If you have a large number of speeding tickets or reported accidents your car insurance will go up. These things show the insurance company that you are a dangerous and sometimes reckless driver. If you do not have a driving record of accidents or speeding tickets the car insurance company will presume that you are a good and safe driver and this will reduce the rates you have to pay.
7) Type of Car You Own
The type of car you own is another factor that will significantly affect the rate that you need to pay for car insurance. The make, model, year and style of car you have will help determine your car insurance rate. This affects the rate of car insurance because it is much more costly to fix a 2019 Mercedes Benz than it is to fix a 2012 Kia. If you have a new and luxury car your car insurance will be much higher than if you had an older model economy car. Another factor that affects car insurance is if you own the car outright or if you have a financing option on the car.
If you are shopping for car insurance it is important to know what factors affect your individual rate. You can work to improve some of these factors, like your driving history, if you hope to lower your rate.