Automobile Insurance You Can Count On…One Hand

Need an Automobile Insurance Quote ?

Cheap Automobile Insurance

When you own an automobile, one of the biggest expenses you must pay is auto insurance. Because state regulators require insurance in each state of the nation, taking time to find cheap auto insurance is extremely important. While some individuals choose to carry minimum liability limits and reject optional types of cover, other wise policyholders will take time to take advantage of every discount to keep their premiums low and still purchase adequate protection. If you are ready to lower your premiums and find cheap auto insurance, now is the time to learn about how auto insurance premiums are calculated. Learn just what factors can affect your premiums, and what discounts you can qualify for to lower your premiums, and you can find low-cost insurance without being one of the many at-risk drivers who choose to carry coverage minimums or no insurance at all.

How is Auto Insurance Rated in Each State?

Just because the requirements for auto insurance vary from state to state does not mean that insurers in each state use different rating factors to calculate auto insurance rates. Insurance companies must collect adequate premiums to cover all of the claims payments that are dispersed on an annual basis. The premiums that you pay for insurance will also be used to pay overhead expenses, shareholders, and for investing. If the insurance company you do business with does not charge adequate premiums, they risk the chance of going bankrupt. To collect adequate premiums, companies will consider several different rating factors to determine which drivers are riskier to cover. Here are some of the rating factors that can affect your premiums when you are shopping for coverage:

* Vehicle year, make, and model

Vehicles with a higher incidence of claims or those that cause high amounts of damage in at-fault accidents will carry higher premiums.

* Driving Record

Individuals with a clean driving record will generally have lower premiums than those with moving violations or at-fault accidents. While some companies will only look 3 years back, many companies will now check for activity up to 7 years back.

* Usage and Annual Mileage

How you use your car and how often you drive will affect premiums. Pleasure users are statistically at a lower risk of filing a claim. Statistics also show that drivers who drive less each year file less claims. Commuters and individuals who drive more than the state’s average will pay more each year.

* Credit History and Home Ownership

Credit plays a role in how much drivers will pay for coverage in only some states. More and more states are using credit history to determine how responsible a driver is. Statistics also show that homeowners tend to be more responsible drivers than renters. Because of this, those with good credit and those who own property may be able to find cheaper auto insurance.

* Age or Driving Experience

Some state regulators, like California state officials, do not allow insurance companies to rate a driver based on their age. In these states, driving experience is used to calculate rates. Typically, individuals who are under 25 or who have less than 9 years of driving experience will pay more for insurance. As more experience is gained, premiums will start to decline.

* Territory

The zip code where your vehicle is primarily stored is also very important. Insurance companies will review theft reports and the number of claims reported in an area to determine if the zip code is high-risk. In many cases, highly populated areas with expensive vehicles are rated higher than smaller areas.

Discounts You Can Take Advantage Of

If you want cheap auto insurance, make sure you take time to understand the state requirements before you start shopping. After you know the requirements, see if you qualify for any of these discounts that are offered by most reputable insurers:

* Multi-car
* Multi-line
* Good Driver/Safe Driver/Claims-free
* Mature Driver Training
* Good Student Discount
* Anti-theft Discount
* Low Annual Mileage
* Previous Auto Insurance Discount

Take time to review your policy and see if you are paying too much for your coverage. Missing just one discount can cost you a significant amount of money. Retrieve your quotes, get all of the discounts that you qualify for, and lower your premiums without lowering your coverage limits.