Car Insurance Rates

Posted & filed under Knowledge Center.

It is almost universal that if you want to be able to register your car, and drive it legally, you have to have at least some auto insurance, but comparing policies can be tricky if you don’t understand what you’re really looking at. We all know, for example, that our driving records can impact how much we pay for insurance, but fewer people are aware of the fact that poor credit scores can make your rate increase, also.

Before you even request an insurance quote, then, it’s a good idea to understand all of the elements that make up an insurance rate. There are three main categories – coverage, deductible, and miscellaneous factors (various credits and deductions) – and we’ll discuss each in turn.

  1. Coverage: This is the biggest factor in determining how much you pay for your insurance, because it’s the amount of the insurance itself. It encompasses not just state-required liability coverage, but also comprehensive and collision insurance coverage, uninsured motorist insurance – all the parts of your policy that pay YOU instead of other people, if your car is damaged, destroyed or stolen. Above that, this is where the make and model of your car come into play, because those kicky V8 engines are more powerful, and power=speed=risk, so they cost more. Financing influences your coverage as well, because if you are paying on a car loan or lease you HAVE to have comprehensive coverage, not just liability, and in some cases gap insurance is also necessary.
  2. Deductible: This represents your out-of-pocket expenses per claim, and it is inversely proportional to the amount of your monthly premium – a higher premium generally nets you a lower deductible, and vice versa. Think of it as the auto-insurance equivalent of the $20 co-pay you make when visiting a doctor, except that the typical deductible is between $500, and $1,000.
  3. Miscellaneous Factors: Everything other than coverage and deductible is a miscellaneous factor. Everything. What does everything include? Your driving record (the length of time you’ve been licensed as well as any “points” on your license from accidents or tickets), your credit score, your age, gender, and marital status, and even your job and level of education can affect your insurance rate. Single men under twenty-five years old, for example, are perceived as the drivers with the riskiest driving habits, so their premiums will reflect that, while mature adults may be able to get discounts for being older, more experienced, and, if they are renewing a policy with a company they’ve used for a while, loyalty.

Other deductions may be given for taking a defensive driving class (when you’re not taking it to erase a ticket), or, for teen drivers, having good grades. As well, insuring multiple vehicles or bundling home and auto insurance with one company can both help decrease your insurance rate.

The quotes we generate for you at are always the best available rates available based on the information you provide. If you think there is a discount not being taken into account, always call the company or agent and talk about it. Knowing what goes into your rate will help you negotiate the lowest premium you can get.