How Are Auto Insurance Rates Calculated?

Auto insurance is an essential investment for even the most experienced and careful motorists. In fact, auto insurance is often required by law, meaning that failing to comply with such mandates could lead to significant fines and penalties. Still, while auto insurance is indeed a necessary purchase, it may also represent an expensive bill. Fortunately, by understanding how your rates are determined, you may be able to optimize your rates while maintaining suitable coverage.

What Factors Are Considered When Getting an Auto Insurance Quote?

A driver’s auto insurance needs are often unique and influenced by many personal circumstances. Subsequently, auto insurance rates can also vary significantly, even for those who may seem to have similar situations or vehicles. By the time a motorist receives their auto insurance quote, the following criteria may have been thoroughly analyzed:

• Location—Where a policyholder lives and drives can significantly impact costs, as areas with higher crime rates or greater risk of natural disasters could incur higher prices.
• Vehicle details—The make, model, year, condition and value of an insured vehicle can all influence auto insurance premiums.
• Driving records—The resumes of insured drivers will typically be scrutinized closely, as those who have been issued citations or involved in accidents may have to pay more for coverage.
• Family situation—If more than one person is going to be listed on an auto insurance policy, it may affect costs. For example, if a family’s teenage child is added to a policy, prices may increase.
• Claims history—If a driver has filed multiple claims against their auto insurance in recent years, they may be quoted higher rates.
• Policy details—Auto insurance can be customized to suit a person’s needs and preferences. For instance, someone who wants a lower deductible may need to pay more for coverage.

We’re Here to Help

Jack L. Bonus Insurance Inc. takes great pride in helping motorists and families in the Zelienople and Jeannette areas maintain suitable auto coverage. Contact us today to learn more or to compare personalized auto insurance quotes.

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.