What factors affect auto insurance rates?
Does it seem like everybody you know pays less for auto insurance than you do? There could be several reasons for this variation in auto insurance rates. While your insurance history is one of the main factors insurance companies use to help determine your auto insurance rates, there are other contributing factors you should also be aware of. Read on to learn more.
Your driving record
Your driving record is weighed heavily when it comes to determining your auto insurance premium. In many states, if you have a good driving record, you can receive a Good Driver discount. However, if you have a speeding ticket or an auto insurance claim on your record, you should expect to pay higher auto insurance rates.
Your family's driving record
If you share an auto insurance policy with your family, spouse, or domestic partner and have more than one vehicle, you may be eligible for a Multi-Car discount. However, be warned that combining policies will also mean that you share in your family's speeding tickets and auto insurance claims — which, if present, will mean higher auto insurance premiums!
Gaps in coverage
Generally, auto insurance companies consider drivers with gaps in their coverage as more risky to insure than drivers who have maintained their coverage. Avoid causing a gap in your auto insurance coverage, even for a day, because it will cause your auto insurance rates to go up in the future!
Your vehicle
Insurance companies base your auto insurance premium on the value of your car and the expense to repair or replace it. In certain states, you can save money on auto insurance by having certain theft-prevention devices and safety features installed in your vehicle.
Get a quote from Esurance to find out how much these features can help you save on your auto insurance.
Your Zip Code
Your auto insurance rates may vary depending on where you call home. If your area has high rates of theft and claims, you can expect to pay more for auto insurance to offset these costs. Generally, highly populated areas have higher auto insurance rates because traffic increases the likelihood of an accident!
Your credit score/rating
Over 90 percent of U.S. insurance companies, including Esurance, use credit-based insurance scores to establish eligibility for payment plans and to help determine insurance rates. (In case you're wondering, credit-based insurance scores predict how likely it is you'll pay your bills in the future.) Actuaries and research analysts have found that the scores help predict your accident potential. If you have a high credit score, you can generally expect lower auto insurance rates than someone with a low credit score.
Your annual mileage
Insurance companies charge drivers with high annual mileage more for auto insurance because they have more opportunities to become involved in accidents (and file auto insurance claims).
The moral of the story is that safe, responsible drivers receive the greatest benefits when it comes to their auto insurance rates. Visit the Esurance Learning Center for tips on driving safety and saving on auto insurance. Get a quote today to see if you could save on your auto insurance rates!
This page is intended to provide you with general information about car insurance, and to help you understand the various kinds of coverage. It does not describe or refer to any specific policy or coverage. For information about your particular coverages, we encourage you to read your policy contract and consult your insurance representative with any questions.