Like anyone who has ever shopped for car insurance knows, there can be major differences in quotes from different insurers. As an independent agency, we shop and compare quotes from multiple Arizona insurance companies every day. If there is one thing we know, it is that no two insurers view a driver’s individual risk profile the same. Instead, each has its own formulas by which they calculate a driver’s insurability and the risk that they will file a future claim. The most competitive insurance company for you might not be the best option for your friend, and vice versa. Some of the reasons why may be surprising. Continue reading to learn the types of variables that factor into the cost of car insurance and what you can do to find a good value for the coverage you need.
Records
Insurance companies will review your consumer and driver records for signs of risky habits or behaviors. Many insurers will pull up your driving record, your CLUE report, and your credit report to accumulate data about your past. Together, these three reports provide a litany of information that can be used to determine your personal cost of car insurance. Insurers are typically looking for things like traffic violations, car accidents, poor management of debts, and a history of multiple claims within the previous five to seven years. Poor credit, multiple claims, or a spotty driving record could result in higher premiums.
Demographics
You might not be able to change your age, job, gender, or marital status, but that does not mean those things cannot play a role in the cost of car insurance. Studies have connected certain demographical information with an increased risk of being in an accident or filing a claim. Teen drivers, for example, are nearly three times more likely to be in a crash than drivers over age 20. Similarly, unmarried males are more likely to be in a collision than married females.
Vehicles and Driving Habits
Insurers want to know the make, model, and age of your vehicle for many different reasons. Some vehicles are more likely to be stolen, making them a higher risk to insure. On the other hand, vehicles equipped with certain safety features, such as airbags or anti-theft devices, could present a lower risk to the insurer. You may also be asked about your driving habits. People who spend more time on the road, such as those with long commutes or who drive a lot for work, are more likely to be in accidents than those who drive only for leisure.
Shopping for Coverage
Though car insurance rates can vary dramatically, there are a few important things to remember. For one, not all insurers treat the variables in your risk profile the same. Some may even overlook certain aspects altogether. That is why you should always shop with an independent insurance agent here at Smart Move Insurance who can match you with an insurer that is more favorable toward your situation.
Secondly, certain negative aspects of your risk profile will eventually be removed. For example, young drivers tend to see their premiums begin to drop in their early to mid-twenties. Likewise, negative marks on your credit report and CLUE report tend to become less relevant over time, with most completely removed within about seven years.
Finally, do not underestimate the power of car insurance discounts. Many times, we can help our customers get discounts they did not know they qualified for. Examples include savings for:
- Good students
- Low mileage
- Having no recent claims
- Having no recent traffic violations
- Completing an approved driver safety course
- Insuring more than one vehicle on your policy
- Insuring your home and auto with the same insurer
- And more
If you are not yet working with an independent agent here at Smart Move Insurance, call us today to find out how we can help you save on the cost of car insurance. We look forward to serving you soon.
