4 Factors That Go Into Auto Insurance Rates

Whether you already have an auto insurance plan or are looking for one, several factors can affect the amount of auto insurance premium you should pay. Factors that affect your car insurance premiums include the type of insurance you purchase and your driving habits – but these factors are within your control. However, other factors such as age are out of your control. Below are some factors to be aware of when shopping for car insurance.

Type of Insurance Coverage

A blue sedan parked in a driveway

There are two types of car insurance – comprehensive and liability.

In the case of an accident, liability insurance does not cover any damage to your personal vehicle. On the other hand, comprehensive coverage covers damage done to your vehicle as well as other vehicles involved in the accident. Although a comprehensive plan can be more expensive, some feel the benefits of this coverage outweigh the price.

Your Car Insurance History

Expect to pay a higher premium if you are a novice driver and have just taken out your first car insurance policy. Insurance providers charge high amounts because they do not have enough data to assess your risk.

A “coverage gap” can also lead to higher premiums when you take out a policy. Examples of a “coverage gap” include; if your insurer has terminated you for non-payment or if you are switching between vehicles and have not yet purchased coverage. Insurance providers view this gap as high risk, resulting in higher insurance rates.

Your Credit Score

Your credit score is an important but overlooked rating factor. Statistics show that drivers with poor credit file more claims than drivers with good credit. These filed claims tend to be more expensive than those filed by drivers with good credit. The difference between drivers with good credit and those with bad credit is more than $1500 per year.

Type of Vehicle

The insurance premium for a brand new sports car is more expensive than the insurance premium for an old civilian vehicle. Your insurer will charge you more each month to cover potential costs like comprehensive and collision coverage if a car costs more.

Contact the RG Insurance Agency

At RG Insurance Agency, we have designed our auto insurance products to fit your needs and budget. Contact us at 956-702-2705 to get a quote today.

RG Insurance Agency | | 956-702-2705 |