What really affects your auto insurance rate? If you are a driver, you likely know the necessity of having auto insurance. What you might not know is exactly what affects the cost you pay for your car to be covered. There are a number of factors that go into determining the cost of your auto policy and there are a number of myths that many drivers think raise their premiums. This article will help you separate the fake from the fact of what determines the cost of your auto insurance!
1. Myth: Color
Specifically that “red cars cost more to insure”. This common word of advice is not true. The color of your car has no affect on the cost of your insurance. Insurers don’t even ask for color when gathering your information. However, red is a “fast” color, so you could subconsciously find yourself driving more aggressively or over the posted speed limit if you switch to a candy apple red Chevy or a fire-engine Ford.
So what does affect your cost when looking into purchasing a car? There are several factors, such as, make, model, engine size, body type, and age of the vehicle. This means that you aren’t paying more for you sporty muscle car because it’s red; you’re paying more for its v8 engine. The same can be said for larger body cars vs. smaller cars, which tend to be less safe in accidents than their sturdier counterparts. You will pay lower premiums on larger cars because they have better crash test performance.
Age of the car also plays a large role, due to the fact that an older model is more likely to be totaled after an accident than repaired, the premiums are lower, as the cost of repairs often exceeds the worth of the vehicle itself. Since the cost of replacing a new car is higher, many drivers typically have higher coverage for collisions, which results in higher premiums.
2. Myth: If a friend wrecks your car, you are not responsible
If a friend of yours is driving your car and has an accident, their auto insurance will be responsible right? Sadly this is a myth. If a friend wrecks your car, your coverage is responsible for the damages.
While you may not have been responsible for the accident itself, you are responsible for the claim and the accident will go on your insurance record, which could wind up sticking you with a higher premium to pay. Think twice about letting others drive your vehicle.
3. Myth: Collision Covers Non-Driving Damage
Collision coverage is enough to keep your car protected right? Well, it is to keep you covered in the case of a driving related incident, but not other damages.
If you have an accident, your collision coverage will be there to cover the costs. While collision coverage is important, if your car is damaged by fire, storms, vandalism, or animals or if your vehicle is stolen, your collision coverage won’t be helpful. To keep your car protected from these non-driving damages, you need to purchase comprehensive coverage.
4. Myth: Your Rates Increase As You Age
As you age your eyesight and reflexes deteriorates, so you will end up paying higher rates as you grow older because your likelihood of being involved in an accident increases.
The truth is often the opposite. With more experience behind the wheel, most drivers over the age of 55 qualify for discounted rates. This is because they are considered mature drivers, with younger drivers 16-24 paying the highest rates as they are new drivers with little on the road experience. Once drivers turn 25, they will usually begin to see gradually declining rates each year, provided they are safe drivers.
What Does Determine Your Costs?
As noted above, there are a number of factors that affect the cost of your auto insurance including the type of car, but there are many based on you. Your age, gender, driving record, and credit, as well as the area you live in, amount you drive your car, and the amount of coverage you want all determine how much you will be paying for coverage. Often, many drivers with clean records can qualify for a discount on insurance as well, click here for more information on how to get discounted auto insurance rates. If you have a bad record behind the wheel, frequently drive your car long distances, or live in an area that is prone to vandalism or damages, you will likely be paying a higher rate, as it is more likely you will need to file a claim.
Knowing what actually affects your auto insurance will help you to better understand your rates and avoid having them go up, but the best way to guarantee you are getting the most out of your insurance for the best cost is to speak with an expert. Our agents are fast and friendly and would be happy to review your current coverage or get you a free quote to compare prices. Give us a call at 724-929-2300 and get the coverage that is right for you!