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FAQ: Auto Insurance Rates Explained
Does where I live affect my auto insurance rates?
Living in a big city means a never-ending array of exciting cultural opportunities; however, it can also mean higher auto insurance rates. When determining your premium, most auto insurance companies will look at your ZIP Code’s loss history to help assess your driving risks. Loss history is an umbrella term that includes your area’s claim’s history, crime rate, and number of drivers. While drivers in big cities seem to have a higher potential for insurance claims, risk factors are not limited to urban areas.
If you live in an area with a lot of traffic, your risk of an accident claim increases. The rise of road rage in recent years only makes this problem worse. Tailgating, speeding, and running red lights can all have disastrous results. Although being stuck in traffic can be frustrating, it’s important to remain patient and courteous on the road. In fact, in most states, Esurance rewards safe driving with a good driver discount.
Those who live on the other end of the traffic spectrum can also be at risk for accidents. Inhabitants of rural areas are often faced with extreme weather conditions and abundant wildlife, both of which can make driving more dangerous. In fact, collisions with wild animals, such as deer, cause an average of $2000 in damages.
If your area has a history of theft or vandalism, it could lead to higher auto insurance rates too. In order to offset the cost of damages to your vehicle, insurance companies must raise auto insurance rates in areas prone to crime. This is usually more common in urban areas; however, some areas are considered more high risk than others.
Your car’s annual mileage is another factor that can help determine your auto insurance rates. If you live in an area where you must commute to work or school, you will probably have to pay more for auto insurance than someone who only uses his or her car for trips to the grocery store. This is because people who drive more increase their chances of getting into an accident.
Besides changing ZIP Codes, there are things you can do to help lower your auto insurance costs. Carpooling, walking, and taking public transportation are all ways in which you can decrease traffic, annual mileage, and risk of accidents. If you live in an area where these activities are not possible, the most important thing you should do is drive safely!
Visit the Esurance Auto Insurance Learning Center for tips on driving safety and ways to save on your auto insurance rates. Find out if you can save on your auto insurance rates with Esurance.
Get a quote today!
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