Category Archives: Premiums and Savings

Does the Car Insured Affect Insurance Rates?

Details of automobiles insured are used as key factors in premium calculations. Cars owned utilize people to do more or less with it. If you own an expensive sports car, insurers assume that you will test its abilities more often than not. Therefore they will include higher chance of accidents and possibly higher damages in them due to speed when they are setting up premiums.

Motorists will be able to see the premium differences between cars when they replace the old one with new. To the surprise of many motorists new premiums can really be very high. So, it is a good practice to get quotes before going ahead and paying for your new automobile. In some cases, your current insurer may not be happy to offer you renewal terms especially if you have a teenage driver listed in your policy and you bought a sports car.

What Auto Features Insurance Companies Take into Premium Calculations?

Specifications of vehicles become extra important when you have Collision and Comprehensive coverage. Companies look at the loss history of the type of vehicle; how did they fair in crashes, how often similar cars are stolen and how expensive it is to repair them. Typical features they need to know and affect car insurance rates are;

  • Engine size: affects the speed and the power of the vehicle.
  • Body type: determines the sturdiness in the accidents.
  • Age and value: puts a maximum limit to how much insurers have to pay in case of total loss.
  • Safety and security features: are usual in knowing how well automobiles will protect its passengers and how well it is protected against theft.
  • Crash test ratings: are given after extensive tests as to how well they will stand against certain types of crashes and what injuries drivers and passengers may sustain.

How These Features Are Affected by Other Details in the Quote Form?

Who drives the automobile is highly important consideration. An older, more experienced driver may acceptable with a sports car but it would be too high risk with a teenager. They don’t have enough experience to control themselves. If the car is reaching amazing speeding in seconds they would let it fly instead of gentle stepping on the brake. That is why many teenagers have accidents on the curbs and they are very often deadly because they cannot get speeding and braking right.

Similarly, an expensive automobile can be insured at reasonable premiums if owned by a middle age home owner driver with a garage and living in a nice suburban location. But the costs can soar up if the same driver is living in city center and parking it on the road every night.

So, cars for drivers is a relevant correlation used by insurers. A good driver can get away with owning an expensive or sports car and not get stung by insurance rates. You would understand the concerns of companies when a high risk driver approaches them to insure a high end automobile. They will want to make sure that they do not end up paying thousands of dollars in claims.

Practical Ways of Cutting Automobile Insurance Premiums

Many families are looking for ways of cutting their household costs and auto insurance has a large share in the budget. There can be many ways of reducing premiums but many motorists want savings and they want them now. They cannot wait to improve their driving records, license points to be deleted or credit score to improve a bit so that they can save money. Even though these progresses will have a large effect on their costs it may be dealt with in the long run. Here are a few methods of cutting premiums down a bit.

Look at Your Driving Habits, Car and Listed Drivers on Your Policy

Many motorists are paying surcharges because of these factors. For example, you may have never allowed anyone else except your partner to drive your automobile and it may be unlikely that you will ever do. Standard policies provide coverage for occasional drivers who use the insured vehicle with the permission of the owner. Obviously this is additional risk for insurers and they have to account for it in their premium calculations. It is possible that you can get a lower premium if you restrict drivers to only listed ones. This will clarify the position better for underwriters and they can offer good deals as a result.

Also, some drivers on the policy can be reduced to occasional drivers. For example, you may have a teenager who comes home occasionally from college or army training and you provide insurance coverage for him/her. You can talk to your insurer and ask them calculate the premium based on their limited usage of the vehicle. Teenagers are high risk group and affect your car insurance rates considerably.

Pay attention to what type of cars you buy. For example, older drivers can be more comfortable and save money if they bought an elderly friendly car that can be adjusted accordingly. Being already high risk they would be paying a lot more uselessly if they have a fast or sporty car. They are unlikely to test the powers of those vehicles to the limit.

Many people like the idea of owning an automobile but they do not drive it as much. Many people prefer to take the subway or train in big cities because of heavy congestions on the roads and costs of parking in city centers. However, your insurer would not know this fact. You should explain to them that your vehicle hardly leave the garage most of the days and you do not use it for commute. Companies do include commute and distance between home and work when they calculate premiums.

Don’t Try to Insure 100% of the Losses for 100% of the Time

In most cases it is impossible to do that anyway. Motorists can save hundreds of dollars every year by assuming higher risks. The easiest way of doing it is by increasing deductibles that will decrease premiums. Many motorists do not have accidents often and a few go years without one. In such circumstances it is a simple math to understand the benefits. For example, increasing deductibles from $500 to $1,000 could save you $200. If you have not had an accident in the last five years you can understand its value to you. In the next five years you can save $1,000 should you not have any accidents. If you have only one you pay $500 more deductible but this does not matter since you saved $1,000 already.

If you have two accidents then you would still save money. How you may ask since your savings is $1,000 and you have to pay $1,000 for deductible. You have to remember that you pay premiums in advance and you will have to pay deductibles only when you have an accident and you make a claim for it. When you have $1,000 deductibles you are unlikely to make claims for small damages anyway that will further save money due to low claim numbers in your records.

How Vehicle Insurance Premiums Are Determined?

Car insurance rates are the base of premium calculations. If you get the low rates you will end up with low premiums. They are like charts of multipliers that used for each applicant. These multipliers may be different for each group of drivers. Each auto insurer has their own way of determining rates to be used. They get approved by state insurance commissioners but they have hardly anything to say about their level. Commissioners can stop unfair rate settings and discriminations but they cannot really tell a company to drop their rates.

Auto Insurance Rates vs. Discounts

Some companies rely heavily on rates to determine the premiums. They apply lower rates for low risks to differentiate the premiums. On the other hand, some companies may use similar rates for most people except certain high risk groups. However, they use discounts heavily. A company that regulates the premiums with rates will include their discounts within the rates. A company that relies heavily on discounts would calculate a base premium and start applying discounts to bring them down.

So, the company that advertises to offer certain discounts may not necessarily be cheaper at the end. Another company can beat their quotes easily since their base rates are already lower. They already cut their rates to reflect good driving history, no claims, safe cars and so on. In other words, it may be too early to assume that a company would be cheaper because of high discounts they offer. You will have to see the final quotes before you can make a comparison.

Why Would You Be Offered Cheaper Automobile Insurance Rates

Gender:  There are many reasons why you would be getting the best rates from certain insurers. Gender is one of them. Ladies on average get better rates than male drivers. Based on long statistical studies many companies see female drivers to be lower risks and therefore being one would qualify you for cheaper auto insurance quotes.

Age: is another key consideration. Teenage drivers get the highest rates for several reasons. First of all they have hardly any driving experience. Secondly most of them, especially the male ones like to take chances with their driving. They like to see how fast their car can go, how it handles the curves on the road and they may not think much of driving while drunk or sending a text.

Things start evening out after the age of twenty five. From then onwards the rates applied may stay stable for some time until the age of seventy. Older drivers are another group that is considered high risk and high rates are applied to them as well.

Cars are another area on the rate chart. Depending on the car insured people get high or low quotes. Each automobile comes with own risk ratings. The higher the risk the higher the premium gets. Usually, cars that can withstand accidents, protect their driver and passengers better, has a low chance of being driven fast or turn over in sharp bends are considered safe and deserve good rates.

Zip code: is one of the key factors as well. The main division is between cities and sleepy towns in countryside. Big city drivers face with high car insurance rates because of the risks associated with living and driving in cities. Vehicle insurance costs can be as much as twice more in metropolitan areas.

Credit Score: Credit history of drivers is included in the premium calculations. Drivers with good credit standing are separated from the ones with bad credit. This could be considered within rates or certain percentage discounts applied depending on how good your driving history is.

Driving History: is the last but not the least important rate setting factor. Good drivers get charged much lower rates compared to the ones with claims and points on driving license. This could result in serious premiums difference at the end.

Affordable Auto Insurance Quotes from Top Insurers

At times there has been bad publicity against large corporations suggesting that they are there to rip off their customers (and even the treasure with the bank bailouts lately). This may be engraved in some motorists’ mind and affect their choices when they are looking to get car insurance quotes. In other words, some drivers may not even give a chance to larger insurance corporations.

However, they may lose out because of this decision as much as those companies. It is an undeniable fact that top auto insurers offer better security as most of them are well established over the years and larger selection of policies. In most cases, they can offer better customer support due to their large presence across the country with agent and service provider networks.

How Can Larger Vehicle Insurance Companies Offer Lower Quotes?

There are several reasons for it. First of all they can attract the best risk analysts and underwriters. They can pay them more money and offer better working conditions as well as more respectability. This would result in sharper automobile insurance rates. They can also offer many different products that allow applicants to choose the most cost effective one with the best coverage for money.

Their overheads per policyholder would be lower as well. Cooking for only two people would be more expensive than cooking for a family of ten. Even a smaller company would have to have certain positions filled with high salaries. When you spread the business running costs to their thin customer base each policyholder would end up pay larger contributions. Remember high overheads have to be reflected on the final price offered to consumers.

The numbers of policyholder big insurers have plays an important role in premiums charged as well. Let’s say that both a large company and a small one want to make $200 profits. Smaller company has only 50 clients and they have to make $4 dollar profits from each of them (50 x $4 = $200) to reach their profit goals. And the larger provider has 200 clients and they only need to make $1 profit from each policyholder to achieve their profit targets (200 x $1 = $200).

Larger car insurers have clear advantage over the smaller ones. Looking at the number of policies each of the top ten car insurers have sold it suggests that they are using it well. Millions of policyholders cannot all be wrong. In addition, the large volumes these companies operate with would be a good recommendation for the new applicants.

Should We Always Choose Larger Companies Over Smaller Ones?

The argument above is not for which company you should choose. It is for making a point that you should get auto insurance quotes from larger companies as well leaving what you heard and your political views aside. This would allow motorists to make a better choice and possibly save money. In the same way, you should get quotes from smaller, local and specialized insurers as well.

Smaller regional companies can be very effective in risk assessment due to their specialized set up for the region or specialist marketplace. They would run out of few select offices and as they are local to you this would not cause any concerns. They may have few hardworking staff members that keep the costs down. It is not unusual for employees to hold several positions in smaller companies.

Whatever type of company you choose at the end you will probably get it right if you shop around enough. You should not reduce your possibilities with hearsay and prejudice. You want to buy the right policy and save money in the same time.

Large Automobile Insurance Discounts

There are plenty discounts offered for motorists when they are buying auto insurance. Every little one of them will of course help you reduce costs. However, some of the larger discounts are the ones that make a real difference. If you cannot get them you will need to get a few of the small ones to make up the loss. Here are some of those bid discounts.

Good Drivers Always Get the Best Car Insurance Rates

If you really want to see as much as forty percent lower rates you need to be a good driver by avoiding claims and traffic tickets. If you can manage to keep it clean for three years you can get between twenty to forty percent savings depending on the company you apply. Some companies keep giving further discounts for up to five years no claims.

Also, you would have the chance to look in those low vehicle insurance premiums by qualifying for accident forgiveness coverage and buying it. Most companies would look around three to five years no claims before they can offer this cover. Once you have it the insurer promises to look the other way when you have a claim the next time. They let one accident slip without increasing your premium.

Good Credit Score Is More Important Than You Think In Car Insurance

Many motorists suddenly see as much as twenty five percent rise in their premiums at renewal and cannot figure out why. Suddenly letting your credit score drop can do that to your vehicle insurance costs. More and more companies sign up to this concept of financially stable motorists making lower risk policyholders.

Not many people argue about the relation between claims and credit score anymore. The statistical relevance of credit score has been proven by even state insurance authorities while they try to disprove it. Look after your financial affairs well and save money on car insurance. It is hard to get around twenty percent discount for any other reason. Some companies do offer large discounts on this while few may not pay as much attention. So, if you have an awesome credit record look for better quotes.

Choose the Right Car If You Don’t Want to Pay High Insurance Premiums

Another area closely looked at when determining quotes is the car insured alongside personal details of the drivers listed and their driving history. Premiums demanded can easily be doubled depending on your car. Sports and high horse power cars, Sports Utility Vehicles (SUV) and most stolen automobiles are expensive to insure because of the expected losses.

Insurers like the cars with solid body that can withstand accidents. They also look for features that reduce injuries to drivers, passengers and occupants of other cars they crash onto. Advanced seat belts and air bags are some of these features appreciated. The ram bars installed on some of the SUVs are not appreciated as they cause more damage and severe injuries on third party people and properties.

If you are considering changing your car or buying the first one for your teenager you should get quotes for the models you are considering first. This will allow you to see how these cars are liked by insurers and help you to make a decision.

Other Factors and Ways of Saving Money

Age and gender of drivers is a very important factor in premium calculations but there is not much you can do about these factors. Education level, profession, homeownership, being married, having a low mileage and living in a safe neighborhood are some the other factors that affect your rates. Try to pick some more discounts by qualifying for them where possible.

Pay Car Insurance Premiums Upfront and Save

Auto insurance premiums are large expenditure for most people. Many people are prepared to go without insurance because they just cannot afford to pay the costs. For those people our title may not make any sense or even anger them. On the other hand, many people have the option to get credit from auto insurers or from credit card companies.

What Are Car Insurance Premium Payment Options

Most companies are flexible enough to cater for variety of payment needs. However, the way they do and additional charges they apply differ considerably. For example, some insurance companies get their money upfront whichever way you pay the premium. You would ask how it would be possible when you are paying the premiums monthly.

What they do is to set up a loan agreement for you with a finance company. You pay the premiums and interest to this company and in return this company pays your insurer the full premium. Should you cancel the policy or payment option they let the insurer now. Then, the insurer cancels your policy and pays the company back whatever is due. As a result you may be paying interests and loan set up fees within your monthly payments.

This does not mean that there aren’t companies who are happy to let their customer to spread the premium over a longer period of time. You just have to check the payment options and the additional charges if it is important to you and you can only make the payments on monthly basis. A cheaper quote may end up more expensive once you add the finance costs of monthly payments.

Monthly Payments allow policyholders spread the costs over a longer period with equal payments. Usually, automatic payments set with the bank and money is collected at specified day of each month. As long as you keep enough money in the bank you should be alright with this arrangement. Of course you need to check the additional costs for this service. Also, most companies would carry out a credit check on you to make sure you will not miss payments. If your credit score is low you may not be able get this option with many companies.

Shorter Instalments may be available with some companies. Not every company allows instalments over 10 months or longer. They may allow five instalments at no or lower costs. This option may suit you as you get your instalments and not get charged much. Besides all you may need is just few months to pay for the premium.

Upfront Annual Payment is an option that has the least complications and most preferred by insurers. They get their money right away and this reduces the chances of policies being cancelled half way through due to no payment or switching to cheaper insurers. If you are only monthly payment it is easier to switch since you have not paid the whole premium and all you need to do (in most cases) is to cancel the payment through your bank.

Companies like this full upfront payment option so much that they are willing to offer around five percent discounts to persuade policyholders. However, they may not offer this discount automatically if you are ready to pay the premium in full before they even ask. It is always worth checking if you would get discounts for paying now and in full.

Even you do not get the discounts by avoiding the interest charges on monthly payments you may save money. Remember that every company is different and you should check the options available through your preferred provider.

Car Insurance Discounts for Certain Professions

Historically many large companies of today started their business life as a specialist insurer to certain sector or group. Some of them still work mainly with the same group of clientele. Others build business models on offering good car insurance rates to certain group of people. This does not necessarily mean that they will offer you the lowest rates. Nonetheless, you should at least get a quote from them before checking with the rest of the market.

What Professionals and Groups Can Get Discounts?

Various companies offer different discounts for different groups. GEICO is one of those companies that offer around fifteen percent savings to over 270 professional groups, clubs and associations. USAA Insurance offer policies exclusively for military service personal, their immediate families and retirees. There are other companies that offer discounts for teachers, academic staff, nurses, doctors, engineers, fire fighters and many more.

Not related to your profession you can get discounts for being member of certain automobile clubs like AAA, working for companies with special deals with certain insurers and being member of associations with good ties with insurers. You can check these online and may even become member there and then to qualify for immediate savings.

Why Auto Insurers Offer These Savings?

You may not actually be interested in hearing the answer and the fact that they do may be enough for you. However, there are several reasons. First of all, they study certain professions and find them to be low risk. For example, some companies consider engineers to be low risk maybe perhaps they are more methodological about driving.

Secondly, some companies have chosen certain part of the market as their speciality and they corner that market better than anyone else. For example, USAA Insurance is one of the largest auto insurers in the USA and they achieve it even though they only sell policies to army personnel. They also provide home insurance and banking services for this group. It is clear that it worked out well for them.

Thirdly, it is better to win customer in thousands rather than in ones and twos. By offering discounts to certain groups they manage to lure them in with little advertising efforts. Also, word of mouth works very well when you are targeting certain group that communicate with each other on a regular basis. So, the discounts offered may just be the savings they keep from advertisements.

Would Education and Success in Life Help As Well?

You should absolutely make it clear that you have got a degree and you have a good desk job. Also, being a home owner and living in nice neighborhood qualifies you for lower auto insurance quotes. Some companies care about education, profession, financial standing and background as much as driving history.

This fact has been proven with researches carried out by online brokers. They have chosen several top vehicle insurance companies and got quotes from them using prototype applicants. Results are that applicants with good education, home ownership and married life managed to get better rates than single parents with blue color job and living in a rented apartment.

If you can qualify for any discounts whatsoever why would you not go for it and keep your costs low? Look into what your qualifications are and which companies value those more.

What to Do for Affordable Car Insurance Rates

Some drivers may find themselves stuck with high vehicle insurance premiums. Others may simple want to lower their costs. It is not desirable to be paying over thousand dollars more than your friend with similar details. You need to ask yourself what they are doing to be rewarded by auto insurers. Then, you should look into the areas you can improve. Here are some of the key points to getting the most discounts and lowering your premium.

Driving Related Factors That Affect Auto Insurance Costs

One of the most important and most rewarding factors is driving history. The largest discounts are usually offered to those motorists with no claims and no points on the license. What better way of showing that you are a low risk for automobile insurers than making no claims on your policy. In return you will be rewarded with discounts up to fifty percent.

Good Credit History Is Important These Days

Many people may still struggle to see the relation between credit history and auto insurance. However, most companies are convinced that there is a correlation. Statistical data is strong to show that people with good financial standing are less likely to make a claim. Having above average credit score may mean twenty five percent lower auto insurance premiums.

Buying Safer and Securer Automobiles and Saving on Insurance

Tons of money invested on improving safety and theft prevention solutions on automobiles. These improvements are followed closely by insurers. Companies do reward owners of safe cars since they reduce injuries, property damages and they prevent accidents. Many motorists keep changing their vehicle every three or four years to make sure they have the latest features. Look for the cars that have high insurance ratings and save money.

Your Zip Code and Home Can Reduce Car Insurance Rates

Where you live is very important in terms of premium calculations. Detailed zip code risk assessments tell companies where motorists are more likely to make claims. If you live in a high risk area with congestions, auto theft and vandalism you will pay for it as a way of high premiums. Also, having a garage, off street parking or secure place to park your automobile can save you money. Furthermore, home owners can save money in two ways. Companies offer discounts to people with more settled lifestyle like owning a home or being married. You can increase the savings by insuring your home and car from the same company and get around ten percent savings.

What Else You Could Do to Reduce Vehicle Insurance Premium?

Probably the best place to start is to look at the current coverage. Motorists can find excellent package policies on the market today. The more you customize your policy the more it may cost. Most full coverage policies offer liabilities, collision, comprehensive and uninsured driver coverage. This would be good enough for many people especially when they like to reduce the costs as well as getting a decent policy.

Shopping around is another effective method. The best part of it is that you do not have to wait for years to gain the discounts as it is the case with good driver discounts. You can start searching for a decent coverage at affordable premium right away on your computer.

When to Assume Higher Risk with Auto Insurance

When motorists buy car insurance coverage they pass the risk with accidents and other losses to insurers. The more of the risk you take on the lower your premium should go down. This process is called self-insurance and commonly used by individuals and companies. It is a balance between paying premiums or accepting to pay some losses out of the pocket should they ever happen.

There are several ways of achieving this goal of reducing insurance costs by accepting lower risks yourself. These can be categorized as below;

–          Lowering or dropping some of the cover on older vehicles

–          Increasing deductibles that lower the premiums

–          Paying small damages out of pocket so that you keep premiums low.

Dropping Full Coverage on Older Automobiles

When your car is as old as ten years its value would be low enough for you not to bother insuring it for collision and comprehensive coverage. You should check the value of your auto and see if it is something you can handle. This is especially true when you are planning to buy a replacement car or you are already not using it much.

For example, if the vehicle is around $2,000 worth and you are paying $1,000 for collision and comprehensive coverage and have $1,000 deductible it is sensible to drop these covers. Otherwise, you would have already paid $1,000 for the premium + $1,000 deductibles you will have to pay should you suffer an insured loss. By dropping collision and comprehensive cover you would have the option to use the money saved for a new vehicle.

Adjusting Deductibles to Save on Premium

When the deductibles increased the premiums should come down because you are taking on more of the risk. This also effectively means that you would not be able to make a claim for small losses. For example, increasing deductibles from $500 to $1,000 may save you several hundred dollars. This option may be better than dropping the coverage completely in some cases.

While doing that you should keep a few points in mind;

–          Do you have enough savings in the bank to cover the deductibles? If you have only $500 on your name in your bank account increasing deductibles to $1,000 is obviously going to cause cash problem for you should you suffer a loss.

–          Do you save enough by this practice? If the premiums are not coming down even when you increase deductibles there is no point. Check the savings before going ahead with the decision.

–          Are you likely to have accidents? When you are living in a quite area and you have not had accidents for years you may benefit from increased deductibles.

Paying for Small Damages Out of the Pocket

When you make a claim on your policy you can bet that your premium will go up at next renewal. Paying for small damages out of the pocket allows you to keep quiet about small incidents. Also, remember that you have deductible that will need to come out of your pocket before the insurer pays anything. If your deductible is $500 you will only get $200 when you make a $700 worth of a claim.

You need to consider if it is worth it especially when you will see much more than $200 increase in your premium at the next renewal. The problem will be a lot worse when you have another accident that is out of your budget as well.

Searching Online For Low Auto Insurance Premiums

So many new methods are used by companies to attract customers that sometimes you need to keep an eye on these deals. A few of them may be just empty promises of cheap deals. Once you check carefully you may realize that you do not qualify. Even worse, they may be offered by your own insurer but existing policyholders are excluded. If that happens, you will probably be angry with them.

However, it is a constant change and you will need to be on the lookout. Many consumers may believe that prices should be around the same range. Maybe few dollars higher or lower and that is certainly not worth wasting time searching for the lowest price. This is exactly the reason why so many motorists are very surprised to see that they can save hundreds of dollars if not thousands every year. This is the beauty of it. You keep saving every year or end up paying higher for ever.

Getting the search going is as easy as a pie. All you have to do is enter a search term on your favorite search engine and off they go to find you a discount or a website where you can check them out.  Sometimes these searches can bring up interesting deals. You may find them on Facebook, Twitter or Google. It really does not matter how you get them as long as you save money.

In social media, many people are sharing what they like and passing on valuable information. Sometimes they tweet about a great deal they found on automobile insurance. At times, agents may direct you there as well. All you have to do is ask if there are any special deals going on. They will tell you to go to a certain Fan page or direct to their official site to get them.

Also, some companies run interesting programs to raise awareness among their policyholders. They may be holding safe driving courses online or offering classes. Once policyholders successfully complete them they are eligible for savings. This is a great way of qualifying for discounts. You learn something and get paid for your efforts, just great.

Even you cannot find a special promotion you will be able to get some rate cuts by shopping around for a better deal. First you should better decide on the level of cover you need. Then start getting several automobile insurance quotes. This will allow you easily compare all the offers on the table. One of them has got to offer good enough savings for you.

Alternatively, you can place a friendly call to your current insurer and ask what’s up. There is no need to be hesitant if you are looking to save some money on your policy this year. Just tell them straight and they will look if there is something they can do. The fact is that if they do not do anything you are likely start looking elsewhere. They know this will happen and they will offer you enough discounts to stop messing around and sign for another year.

Save Money by Combining or Moving Policies

Everyone can benefit from saving money on their insurance policies. However, the benefits may be appreciated more in states known to have expensive insurance rates and high living costs. Also, drivers with higher premiums can see the effects of even small percentage of changes quickly because the dollar amount would be larger. If you have already got a low premium because you are a good driver and living in a state with low rates ten percent savings may not even yield hundred dollar discounts.

When you are struggling with high insurance bills and it is about time to do something there are solutions available. Many companies are aware of the problems and come up with good solutions. Anyway, almost every insurance company offers savings when you bring over your other policies to them. These could be home or other vehicle insurance. Just moving them over can be enough to qualify for savings.

However, the bigger savings can be made by combining policies. Most motorists know about multi-car policies. If you have several cars you can bring them under one policy and save money on car insurance. Even though you have one policy for several automobiles you do not have to have the same coverage for all of them. Most of these policies allow you to determine individual levels of protection for every auto within.

So, you could only have a liabilities only coverage for your old car and full policy protection for the new one. Furthermore, you could buy single uninsured driver coverage for both of them. These sorts of innovations are now common place with most of the auto insurance companies. Some can be even more accommodating than the others in working out a cheaper but effective policy combination.

A step further is policies that cover every risk you have. Some companies can cover your every insurance needs with one policy. You can have your main residence as well as the holiday apartment you have. That is not all. You can include all your family cars in there as well. These packages are designed to give the largest discounts with the best coverage.

The idea of bundling your TV, telephone and internet in one package works very well and saves you a lot of money. The same idea is used in other areas and by different providers. This is great for customers as they have less hassle arranging them all and paying separately.

There are several insurers offering various packages. For example Encompass Insurance, part of Allstate, can combine both home and auto insurance. They estimate that policyholders would be able to save 10% on car insurance and 35% on home insurance if they combine two together. The savings and the combination of policies will be different from one company to another.

As the time pass, there will be even more flexible policies to consider. Should you like to find great coverage at low premiums you should shop around a bit. Also, you can talk to brokers and agents and enlist them to help you find the best.

Car Insurance Premiums Are Affected By Credit Score

Traditional factors affecting car insurance rates are changing. New ways of calculating premiums are being developed. Thanks to programing technology auto insurers can include a lot more variables to their quote systems. One of the most influential factors added in the last ten years is insurance credit rating.

It is a requirement of surviving in the modern world that companies must follow changes. They must research what effects new information and statistics have on claims. This will help them know where and when to raise client premiums and better assess new applicants. With this they will be able to get customers who will be watchful thereby they will know what risks await them.

One good way of doing that is by finding out the financial status of the customer through the credit score. This is not allowed in every state although most states have no problem with it. This may help them know which financial ground their client stands in and thereby offer favorable premium to them. This is referred to as insurance credit rating. It works in the same basis as the normal credit scoring but not as detailed as credit check for a mortgage. Generally, insurance companies looking into your credit history is considered a soft credit pull. This means that there are no chances of reduction in total score.

In many cases, insurers will look for applicants who have not bad record of driving. This will definitely avoid claims therefore lowering their expenses. Nevertheless, there are small accidents that may happen on the road and some customers do not raise a claim while on the other hand some who are not in a stable financial problem can take a claim for a slight scratch. Some would say that they have paid for it and may go demanding.

One thing about insurers is that they do not want to lose their customers at one bit. They work on ensuring that these policyholders remain with them. That is why they usually avoid late payment, cancelling a cover and having customers who have not made their payment. This will force them to increase premium to customers who are going through financial difficulties.

Auto insurance companies deal with the same thing but they do not operate the same way.  When it comes to the issue of rating, there are those who pay attention to it while others do not count it important. Though this happens, you should keep on looking for your credit history. At times you may notice changes especially when you are renewing it.

Watching out for mistakes and making sure that you do not miss payments will help your overall credit score. Hopefully, you will not see unexpected surprises when the renewal comes. Failing to manage your finances well may force the insurers to increase your premium based on their new formulas. Another important point is not to miss your premium payments. Once a payment is missed the company may feel the need to look at your credit worthiness. As long as you keep paying the premiums they may not be the wiser even you have financial problems.

Better Car Insurance Rates for Female Drivers

This could be a moment where you could get a ‘so, who’s better now?’ from your wife; or if you are a wife, this is one perfect I-told-you-so moment, for car insurance companies agree – women  are indeed the better drivers.

Risk assessment and auto insurance rates

Insurance premiums are calculated on a thick set of rules that determine individual risk. Basically, when requested by applicants for car insurance quotes, the insurer will base the figures on statistics that show how likely or not likely the driver will collect from them at some point in the future.

There are several factors that are used in the calculation. This include: driving history, safety rating of the car, value of the car, actual time the car is used, where the car is used, and on demographics such as age and gender, marital status, credit history, or the crime rate in a particular community.

Chief of these is the individual’s driving habits – whether he or she will stay safe on the road. As statistics show, SHE will likely stay safe more than he. Hence, this results in cheaper vehicle insurance premiums for her.

Technical skills and driving behavior

Although numerous studies show than men are involved in more accidents than women (statistically and not just by sheer numbers), it does not necessarily mean that they are less skilled on the road. In fact, men tend to be more proficient on the road.

It seems that men’s skill is their own downfall — for this encourages them to engage in more risky road behavior. Therefore men are more prone to violate traffic laws and to be involved in other sorts of road altercations.

Consider the statistics: men are 3x more likely to be convicted on DUI, more than 3x likely to drive recklessly, and they also overspeed much more than women. In effect, men are of course slapped with more expensive car insurance rates.

Social forces at play

Other factors that may distort the statistics against male drivers are concerned with the way our society is structured. This means while men tend to figure in more accidents, it could simply be because there are more male drivers on the road. Also, in many domestic setups, it is usually the men who need to drive farther to work.

There is also the observation that when couples are driving, the women tend to relegate more driving to their male companion. This includes situations like driving in bad weather, in congested urban highways, or in otherwise difficult conditions. Of course, these are the very same road conditions where most accidents occur.

Setting your car insurance premiums low

For both men and women, however, the only controllable way to get the cheapest auto insurance is by improving your safety driving record. This means obeying traffic laws and keeping your slate clean for the longest time possible.

Insure Multi Cars with Lower Overall Premium

Quite a few motorists keep more than one car. Some people have a few of them. People may think that adding another automobile onto an existing policy will double the premiums. However, this is not what happens in most cases. You may save as much as thirty percent on insurance costs of the second car added.

By adding the second automobile you are letting the company know that you have one more car to drive around. This will spread the risks between two cars and reduce the premium. By the way, you can only drive one of them at a time. Just knowing that you may be driving one or the other will be enough to offer you savings on the overall costs.

Also, you are offering one more business to your current insurer. It counts for something as well. Companies offer discounts even when you bring your home insurance over to them.

Do you have to own all the vehicles in the policy?

Most automobile insurance providers will be happy to add your partner’s and blood relatives’ autos onto the policy as long as they live in the same address. Also, you may be able to add RVs as well with some companies and still get sizeable discounts.

When you are bringing all your family automobiles under one policy you should look into which way would be best overall. First of all, you may need to give up one company and move all to the other one. This will give you more options and opportunity to pick between two good providers you have had experience dealing with. The other point to consider is who is going to be the lead driver on the policy. Sometimes, having the female partner as the lead driver and the male partner as the listed driver can save money.

Another important point to keep in mind is that you do not have to have exactly the same coverage for both vehicles insured. One can have full coverage and you can only have liabilities on an older one in the policy. Cover variation is possible and better to think that way. You still buy what you want for each of them and save money as well.

There may be other ways of saving money on auto insurance as well. Agents and brokers will be able to explain the options available. For example, you could stack your Uninsured driver coverage. When you have two cars you may not need to sets of coverage for the same risk. Instead you can increase the coverage and set it up in a way that it will cover both of your cars. This option may not be available everywhere and with every company.

However, you will be able to lower your rates and still get the level of coverage you need for each automobile. It is always a good idea to explore your options especially when you need to control your budget. Getting several auto insurance quotes and comparing them is another way of economizing a few hundred dollars.

Car Insurance Rates: New Premium Calculation Norms

The telecommunications industry has been notorious for a phenomenon that is now a rallying cause of consumer groups all over the world: bill shock. Recently, it seems the car insurance industry is following suit, with its introduction of various charges and rating schemes unexpected by policyholders.

Setting car insurance rates

Insurance rates and premiums are determined using the concepts of the rarefied field of actuarial science. Actuaries (no, not fortune tellers), as professionals who determine these rates are called, traditionally assessed risk based on statistical and mathematical methods to factor in age, driving record, driving habits, a car model’s safety record, and other variables in order to determine insurance rates.

Lately however, the actuaries are getting creative. Instead of the traditional variables, auto insurance companies now began looking at the individual driver’s financial standing, field of work, and educational level in determining their premiums.

According to industry watchers, several non-driving factors are becoming more and more important. Chief among these is an individual’s credit score, which is now evaluated when applying for vehicle insurance.

Anti-poor?

However, experts warn that these new criteria tend to punish poor people and minority customers. Aside from credit score, firms now also evaluate an applicant’s educational background and occupation. These are areas where minorities and the poor are compromised.

This assertion is borne out by studies. In a research published by UCLA, it was established that automobile insurance rates vary widely, and that they tend to be higher in poor and minority neighborhoods.

It is estimated that almost one-third of premiums in the US now are set using educational and occupational factors along with the more traditional criteria of driving history, age, safety rating of the auto, and similar categories.

Business is business

Morality aside, it must not be forgotten that the auto insurers are running a business – they should be expected to look for ways to get a profit. Like any other business, innovation is key in generating profit margins.

At the side of the insurance industry, it is perfectly legitimate to study their consumer’s economic patterns to determine how much they should charge for their business. And they are claiming that the factors of educational background, work history, and credit score are statistically significant in their line of work.

True, it seems unfair to discriminate based on the education, employment record, and spending patterns of an applicant. But insurance firms are saying that these are indispensable factors in determining whether policyholders will file a claim or not, that is, if they will make a profit or pay out to the customer.

Safety nets

To prevent this system being abused by the insurance establishment, they are required by state insurance regulators to disclose what factors they are using to set insurance rates. Some states also prohibit using credit information for car insurance, such as California, Hawaii, and Massachusetts.

Still, each company has its own specific evaluation method. This cannot be disclosed entirely; this is a closely guarded trade secret much like a famous recipe.

The only alternative left is to research thoroughly for the best auto insurance quotes, balancing coverage against price. If business is running rampant, perhaps only the competition can tame them.

Higher Deductibles Allow Larger Auto Insurance Coverage

It may reach a time a policyholder wants to reduce cost of insuring automobiles. This may not be the wish of the person. Sometimes it is caused by different situations such as financial challenges. The person may think that he is paying too much or the cover is very expensive. This doesn’t have to affect the policyholder too much. There are other solutions to reduce car insurance premiums or keep the coverage.

When it reaches to this point, the policyholder should not give up. The best alternative is to look for more favorable quotes elsewhere. This is because there are many companies that will be looking forward to having you as their customer. You may choose to wait until the renewal period, as you wait, shopping around will open your eyes to see the best.

What confuses people is thinking that all the insurance companies does things in a similar way. Just like how people cannot have same opinions in choosing and accepting things insurers choose different course of action as well. You find that these companies view things such as accident differently and their charges are so. When a company doesn’t want to loosen its ropes, there is another one which is really doing it. That is why coverage differs a lot when compared.

Checking on the deductibles will also offer great help. Remember the more it is the higher chances of facing a lot of loss in case an accident happens. The deductible is covered by the policyholder. For example, if it is set at $500 policyholder would have to pay for the first $500 regardless of the size of the accident. Then, the rest of the damages are paid by the insurer. In that sense, you need to be careful as not to increase them to a level you cannot pay.

Increasing deductibles could also solve some problems. This is because the more you increase them the more likely the premiums go down. Let me highlight an example for you, if you push up your deductibles from five hundred dollars to one thousand dollar, it is possible that you will get a saving of three hundred dollars which is a good saving to consider. If you get a loss through an accident or incident, your insurer will pay you the total losses minus deductibles. If you ever have an accident you will pay $500 more out of your pocket. So, you save $300 when you have no accident and pay $200 extra if you have one in this example.

If you are not looking forward to making a claim, there is no need of paying more on premium. That is why it is important to increase deductible. You can also use them for purchasing more coverage under the same premium. This method is very easy to apply. It is great when you would not normally claim for small losses anyway. It is also great for safe drivers who are unlikely to have accidents. But, people who are compulsive claimers should choose policies with lower deductible.

Lower Insurance Premiums When Car Values Depreciate

Many people go for car that is new in the market. Once they are owned by others values of automobiles drop considerably. After a period of three years you would be lucky if it fetches half of the price you paid for it when you bought new. This is the way it is in the auto market place. Even well looked after vehicles will lose considerable amount on their value.

At this point, you can lower the premium if you are still going to use the same car. This can be done by visiting the coverage and dropping some. With this you can do some calculations to find out how much your rates should be dropped by. You can do a total check up on your car to find its value at that time and let your insurer know about your thoughts.

Valuation is important when you are thinking about lowering the coverage. It encourages people to keep on checking the value of their vehicle to see its market value. A complete cover of a car crash is determined by the value of a car.

Another point to take into account about coverage is that new cars may not actually cost more to insure compared to old ones. This is because most new cars are coming with security devices installed in them and other properties that may reduce further damage when an accident occurs. When the insurer sees this, he knows that the car can hardly be stolen and the damages cannot be worse in case it were to happen. This makes them to offer the most favorable deals to the new car owner.

Though it may seem that old cars do not count, they can help you to save money since their rates comes down. What happens is that the insurer will allow you to take a liability cover for it. This means you will stop insuring it as you have been doing before and begin paying deductibles which is favorable to you. If an old car crashes on the road, it will be hard to be repaired and so the chances of it being repaired are very low which will direct you to a road of receiving lower premium.

This chance that you are opening to yourself tells your insurer that you are ready to risk and take care of your action. If you have not had accidents for a period of time it is a comfort for you because it is a proof that it may not happen soon. But if it happens you should not mind to remove cash from your pocket. The place of your residence will also matter much on this. The best thing is that you can save a lot of money which you can use to purchase another car.

If you bought your car with a loan, you should consider getting at least two quotes. One for a full coverage whiles the other without collision and comprehensive coverage. You should also think on how you can finish paying your entire loan. It is good to go through all the terms of the loan and understand it, get into an agreement with the provider and go on with your plan.