What Factors Impact the Cost of Auto Insurance?

Auto insurance can establish financial security should you be involved in accidents or otherwise suffer vehicular damage with significant monetary repercussions.

While auto insurance can help you save money in the long run, your premiums still amount to another bill for which you’ll need to budget. By understanding the various factors that impact your rates, you may be better equipped to limit your costs.

5 Factors That May Affect Your Auto Insurance Rates

Examining the various influences on your auto insurance rates may make you more capable of planning strategies to potentially lower your costs or at least limit any increases. Consider the following factors impacting insurance costs:

1. Location—Where you live and drive can make a big difference in your premiums. For instance, if you’re in an area prone to natural disasters or with greater crime rates, your prices will likely be higher.
2. Vehicle specifications—The age, make, model and value of your car can all have a significant impact on your costs. Although newer and more valuable cars are generally more expensive to insure, sometimes these vehicles have more advanced safety and security features, which could also lead to discounts.
3. Driving history—Your driving record, as well as those of anyone else insured under your policy, helps carriers assess risk levels. You may qualify for lower rates if you have a clean record with limited or no violations and accidents.
4. Credit score—Insurance carriers often use your credit score to calculate an insurance score, which contributes toward analyzing risk levels. A poor credit score can, therefore, often lead to more expensive premiums.
5. Coverage details—The types of coverage and other details of your auto insurance policy, such as its deductible, go a long way in determining rates. For example, if you have a higher deductible, you need to pay more out of pocket when filing a claim but can often see savings on your premiums.

We’re Here to Help

Contact Hanway Insurance in Oak Lawn, Illinois, today to learn more and ensure you have the right coverage at an ideal price.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.