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Five things that affect your car insurance

When it comes to car insurance, it may be hard to understand the numbers and how everything is calculated and how the numbers affect your insurance cover. However, you must recall that the numbers added up by car insurance companies are cautiously calculated. By making use of information such as your claims history, car insurance companies use calculations and algorithms to make an informed guess on how much you are likely to cost the insurer. Based on the outcome of the results, the insurer can deduce whether you are high risk, meaning you may pay a higher premium, or low risk with lower car insurance premium payments.

Car insurance companies also use risk factors to determine a client’s payment upkeep. These risk factors may include your age, gender, credit history, vehicle type, driving record and years of driving history. Each factor is assessed differently and may affect your vehicle insurance premium. For example, your gender does not necessarily affect your claim probability compared to your overnight parking location.

Below are four major factors that could affect your car insurance:

Your residential location or where your car is parked overnight plays an significant role when it comes to your car insurance premium payment. If you live in an area that is very populated or has a high rate of crime involving stolen cars, the insurer may set a higher premium on your car insurance. If your daytime address (most most likely the area in which you work) is in an urban area, this means that there is a greater risk of you having a motor vehicle accident than if you lived and worked in a remote location – thus enlargening your chances of having a higher premium.

Inexperienced drivers are considered a higher risk by insurers. Basically anyone without a credible driving history is likely to pay high premiums. Whether you are sixteen or forty years old, if you haven’t driven a car or have no record of previously wielding a car you are seen as inexperienced and a high risk driver according to car insurance providers. The more years you have as a driver, the better your chances of scoring a low car insurance premium.

Albeit you might be a seasoned driver, car insurance providers also look at your claims history reports that you might have made with other insurers. This can have a positive or adverse outcome on your future vehicle insurance premium payments. If you claim three or four times within one calendar year, car insurers will very likely see you as a high risk and may determine to hike your premiums or terminate your policy at the end of the term.

The type of car you drive also affects your insurance premium rates. Besides the vehicle model, other extra factors that affect your insurance premium are;

• The price at which you want to insure your vehicle at
• The vehicle’s average theft rate
• Cost of repairs (parts and labour)

In essence, maintaining a clean driving record, good credit score and choosing the right cover for your vehicle will ensure that you get the best deal out of your insurance policy. Get car insurance quotes online now!

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