Rates and Discounts

The rates that you pay for your car insurance are decided by a number of factors. There is a reason for it, even if it seems totally arbitrary to you! The good news about this is that some of these factors can be controlled. The bad news is that many of them cannot. However, you may be eligible for policy discounts. Insurance companies offer discounts for such things as having a good driving record or having anti-theft devices installed on your car.

Controllable Factors

Believe it or not, you can affect your car insurance rates in a good way. Who you are as a driver has a lot to do with what you pay. If you can prove to your insurance company that you are a "good risk," they will reward you by lowering your rates. That is, if you maintain a good driving record and pay your bills on time, then you will most likely continue to do so in the future. "High risk" drivers are those who have violations on their driving records, such as DUI's or accidents.

If for some reason you allow your policy to lapse, and are uncovered for any period of time, your insurance company may raise your rates. Insurers do not like seeing gaps in coverage. If you have let your policy lapse or be cancelled in the past, it may happen again.

The type of car you drive is another controllable factor. Everything from the worth of your car, its size and weight, whether it is new or used, and how expensive it is to repair or replace if stolen are all part of the equation. A heavy, large station wagon is less likely to suffer costly damage in an accident than a small, light sports car, which means lower rates for the station wagon owner.

Uncontrollable Factors

Among the things you can not control which affect your car insurance rates include your gender, your age, and your geographical location. These are all based on statistics. Females and males generally pay different rates for the same coverage and under the same conditions. This is because females are generally safer drivers and get into less accidents than their male counterparts.

Your age is another major influencing factor when calculating your insurance rates. This has to do with your experience as a driver. Younger, less experienced drivers, are more apt to be involved in car accidents. On the other end of the spectrum, senior drivers also tend to pay higher rates for their car insurance. This is because their skills may not be as sharp as they used to be.

Where you live also affects your rates. If you live in a big city or an urban area, you will pay higher insurance rates than someone who lives in a more rural area. There are more cars on city streets that you have to share the road with, and therefore are more likely to be involved in an accident with.

Saving Money on Car Insurance

All is not lost when it comes to saving money on car insurance. Comparison shopping can help you find the best rate on the coverage you need and want. Even if you are already insured, you may want to get quoted by another insurance company, as they may be able to offer you a lower rate for the same coverage.

Many insurance companies offer a variety of discounts. You should ask your insurance agent about the discounts that are available and which of those you qualify for. You may find that you qualify for a rate cut – but you will not know unless you ask.

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