Auto Insurance Factors

Auto insurance premiums are based on many factors. One factor is age, another is the driving record of the policyholder. Auto insurance premiums are higher if purchased with a lower deductible. The deductible is the amount you agree to pay if a claim is filed. The factor most people overlook is the region or area where they live.

Where you live is a big factor in determining your auto insurance premium. Generally speaking, if you live in a rural area versus a urban area, you are far less likely to have your vehicle stolen. There is also less traffic in rural areas which leads to fewer traffic accidents. Taking all of this into consideration, if you live in a rural area, you might consider raising your deductible for even more savings, as your chances of filing a claim are pretty low.

On the other hand in urban areas car theft is not unusual and crashes occur with regularity. Many of the car crashes are a result of the fast-paced life of city dwellers. Everyone is in a hurry even if there is no special time to be at a location. Auto vandalism for profit or fun is perpetrated far too often. People involved in these incidents file claims which are spread among urban policyholders, raising the rates of everyone.

If you do have to file a claim, depending on its size and your policy deductible, you might want to consider paying for repairs out of pocket versus filing a claim. Almost every insurance company will raise your insurance rates once you file a claim. There are exceptions. Some insurance companies are now starting to offer accident forgiveness programs. These programs overlook your first accident claim. The company won't raise your rates - on the first claim you file.

Auto insurance is a necessity if you want to drive. Always look for ways to lower your premiums. Ask your insurance company if they'll lower your premium if you take a defensive driving course. If you own your home, find out if you will get a discount by moving your homeowners policy to the same company you get your auto insurance from. If you're married, make sure your auto insurance company knows about it. Married people always pay lower auto insurance premiums. However, the best way to keep your rates low is to maintain a good driving record. It's still the number one factor in determining auto insurance rates.