Many things that affect the amount of auto insurance premium a motorist should pay are personal, like age, coverage preferences, vehicle driven, accident and ticket history and credit score. They all play significant parts in determining the rates but all start with where you live. There can be significant differences in rates applicable to you based on your state.
For example, the average cost of minimum liability vehicle insurance in Maine is only $225 but it is over $1,100 in Michigan. So, motorists who want to find out what the fair car insurance premiums they should be paying should start with checking their state averages, which can change several fold. Different state regulations, demographics and socio-economic conditions contribute to the premium gap between states.
Another key influential factor is the provider. Depending on companies, automobile insurance quotes can be all over the place and substantially different from each other. This is an external factor and it may not necessarily be a reflection on you. That is why, getting a few quotes will quickly show the price range a motorist may be facing.
Obviously, a good driver with a long history would get fairly low rates, while someone with a recent at fault accident claim may be quoted much higher. Nevertheless, people would still be able to see the lowest and highest quotes they can get today. Car insurance isn’t a commodity where prices are easily comparable. Nonetheless, it isn’t hard to know when a carrier isn’t being fair with you and charging you more than most providers.
Make, model, value and other particulars of the car insured not only affects premiums but also it can be instrumental in the level of coverage required. If motorists are having problems with getting affordable auto insurance rates, they can buy a reliable but not much expensive used vehicle for the time being and go for Liability only coverage, which could cost only 1/3 of the price of a full coverage.
Age is a very telling factor especially in the early years of driving life. If you are a teenager, you shouldn’t be comparing your car insurance cost with a middle-aged person. Actually, you should be expecting to spend around 3 times more than them. It is important to check it against people of a similar age and gender. For example, a teenage girl can get about 15% lower rates than a teenage boy.
How to Know What You Pay for Auto Insurance Is Fair?
Although it is difficult to comment on individual costs there are a few factors that can influence the premium positively or negatively. You should check below points first to determine if you are a low-risk vehicle owner who should be paying less for car insurance or the opposite.
- Good motorists with no recent claims or traffic tickets get the most discounts. They should save about 30 – 50% in comparison to people with imperfect records.
- A recent accident claim can increase rates 20 – 60% depending on where you live and who was at fault. In states like California where driving records are the main factors taken into account you could see large increases.
- Credit score can be as important as driving history and a good credit score can alleviate some of the claim related increases in states where credit checks are allowed. So, a recent drop in your credit score can push up rates more than you expect.
- Several tickets are obviously a worry but one DUI can be a serious problem in many ways.
- The type of vehicle you own can affect costs a lot. If it is a normal run of the mill sedan you probably don’t need to spend much. On the other hand, sports type cars can trigger enough alarms with some companies to double their quotes.
- Auto insurers look at the policyholder’s driving records more closely. But having a teenager or a high-risk driver in a household can influence costs notably.
- Living in a high-risk zip code like a city center or high crime neighborhood can influence rates a lot in relation to a nice township.
- Things like being married and owning a home usually allow you to save some money on car insurance and therefore you should be paying less than someone who is single and renting.
- If you seem to be struggling to get affordable coverage right now you should know that this can change if you can manage to stay away from above troubles for only a few short months. So, current problems can be temporary.
- Finally, shopping is the best way to lower costs. People who shop around spend only a fraction of someone who never shops.
The bottom line is that you shouldn’t be naïve to think that vehicle insurers offer similar quotes. It isn’t the case as every company is different in many ways including price. And you can save money by checking the alternatives.