Editor's Choice Insurtech Intelligence

How car insurance affects on your budget?

When looking to cut down your car insurance rates, you main goal may be to reduce your deductibles or choose lower amount of coverage. Well, those are important considerations, but there are other ways to lower the overall cost of your car insurance. If you have the right information on what affects your car insurance policy, you may have the chance to reduce your insurance cost to a considerable level. Let’s find out other factors that affect your car insurance cost.

Demographic factors
These include your credit score, geographical location, marital status, age, as well as your gender. It’s obvious that older women have higher insurance rates than their male counterparts. This is because of the belief that women have more minor accident cases than older men based on their experience levels. But this difference is not really much. On the other hand, younger men have higher insurance rates than younger women because the former tend to be in more accident cases than the latter.
Marital status is also factored in when determining your rates for car insurance and general insurance. It’s obvious that single people tend to be more involved in accidents that married people, so their rates are always higher. You can significantly reduce your rates when you get married. But the extent of the deduction will depend largely on your driving history. Your car insurance and general insurance rates will reduce if you seldom get into accidents. You could see your rates slashed by half in some cases. So, your driving history is an important factor.
Your geographical location is also put into consideration, albeit on a lower scale compared to driving history. Insurance companies feel those who live in a densely populated area with more cars stand at a higher risk than those in sparsely populated areas. So, your geographical location is an important factor that determines your car insurance and general insurance rates.

Credit score: This is another important factor that can affect the rates of your car and general insurance. Insurance companies believe individuals with better credit score are usually more careful than those with poor score. The lower your credit score, the higher premium you are going to pay for car and general insurance.
Your job: Your profession can be taken into account when determining your rates for car and general insurance. For instance, journalists, delivery drivers, and others who are constantly on the road will have to pay more for car insurance. This is because they are at higher risk ratio compared to individuals who are not constantly on the road.

Car related factors
Apart from the above, car and general insurance quotes can be affected by the nature of your car.
Safety rating: If your car has certain safety features, it can positively impact on the car’s insurance premium. If there are some safety features like traction control, automatic seat belts, and airbags, you are likely going to pay less for your car insurance.
Age of the car: Generally, the older the car the higher the insurance cost. This is because cars that are older are usually more likely to develop issues, leading to repair costs. Sometimes, the cost of some major repairs for an older vehicle can come close to the entire value of the car. Moreover, older vehicles experience more total damage than newer ones. Consequently, the car and general insurance cost is usually higher.

Personal driving habits
Your personal driving habit is another factor that can affect the car and general insurance rates. Insurance companies consider factors like drinking habits and previous driving records. All these are considered when setting your premium rates for car and general insurance.

Whenever you are ready for car insurance, remember that insurance companies will be critical to reduce risk as much as possible. If you play your own part to ensure the risk is minimal, you will definitely pay less for insurance cover.


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