Answer:

1. type of vehicle (model, year, and value): Statistics show that the accident rates are different for different cars. Some kinds of cars are also more expensive to repair.

2. how you use the vehicle (i.e., pleasure, work): Using your vehicle for work will probably increase your premium.

3. age, sex and marital status: Older drivers, female drivers and married drivers statistically tend to have better driving records. Therefore, they tend to have lower premiums.

4. where you live: Some states have higher accident rates than others. In particular, states with high population density tend to have more accidents. Other local factors, such as the type of insurance system in the state, also affect insurance rates.

5. prior insurance coverage: Being a new driver, or a driver with no previous history of insurance coverage, will probably mean higher rates.

Auto Insurance Rating Factors. Factors That Affect Your Car Insurance Premium.

The general question of all clients of the auto insurance companies – why do my rates go up? What is involved in change of my rates? Factors, which are used by the various car insurance companies to calculate rate and reduction increases, it is difficult to understand, but not it is impossible.

Not all auto insurance companies have the same increases in rate. The car insurance companies can suppose it because they use various experts of risk or various variables to solve about rate increases.

You ask the insurance agent how precisely norms raise? But he cannot precisely explain you it. It occurs that the majority of the auto insurance companies has developed own unique mathematical algorithm. The representative of the company sends the information on the insurer in the computer which processes the information and spreads the ready answer. This algorithm can be too difficult for the average insurance representative to discuss, but they should have an Insurance Instruction (Underwriting Guideline) and also a management by principles of change of an rating (rating change guidelines), in to help to explain to the client. You should be always informed in understanding of your factors of an rating.

Factors of an rating of the different insurance companies very much differ, but there are many general lines in which all of them are based on historic facts (history of claims). The new companies start to use new unique single rating factors as distance or leading habits (range and driving of the styles defined by systems GPS which read to speed, a range, and frequencies of stops). All companies should know about all members of your family who have a driving licence and, possibly, will drive the car. Even if other drivers will have an insurance the auto insurance company should know about them.

As you see, many factors influence the sum insurance a payment which you pay car insurance. Everyone statistically is based on risk for certain group of the population. The above risk connected with the person, the more it or she, will pay for auto insurance coverage.

The majority of the auto insurance companies still uses these standard rating factors:

Age

Statistically, drivers are younger than 25 years in greater risk of to get to accident, than those that are more over 25 years age. At drivers who are in age between 50 years and 65 years is the most safe.

Gender

Statistical data show, that men get to incidents than women is more often, thus the companies estimations (grouping) distinguish it as the factor. Women – statistically more safe drivers, but this tendency changes, as more than female drivers appears on roads.

Marital Status

Statistical data of requirements specify that lower rate of car insurance claims among married holders of an auto insurance policy, than rate of claims among single holders of an auto insurance policy.

Geography, Territory

That, where do you live, is of great importance. The people living in areas with small or any movement, possibly, will spend less for insurance than what live in the overflowed cities or suburb. It speaks that at what areas with the big movement tend to occur more accidents. Some neighbourhood also has higher norm of stealings of a vehicle which can lead to higher auto insurance premium.

Some states (as California) cannot use it as the factor of an estimation because of laws.

Driving Violations, Driving Record

Having an accident or moving infringements on your record (speeding tickets, DWI, reckless driving, etc.) the car insurance company places you in higher risk of accidents, and it means that as a result there will be higher auto insurance premium.

Some companies analyze your driver's history for 3 years some for 5 years and others look for 7 years. The most unique sight at the incidents suffered by any driver which is covered according to the policy during time corresponds to three (3) years.

Some insurance companies can fine you for your record within the whole five (5) years from when incident has occurred. However, keep in mind, that your record improves in due course, your car insurance premium becomes more low.

Vehicle Type

Will insure the cheap car to cost much more cheaply, than to insure than that status symbol SUV sitting on 24" rims.

Vehicle Make, Model, and Style

Each model of the car has the history of incidents, thus you are placed in similar rating group for this item. If at your mark of the car will be more larceny or history of vandalism or high repair expenses because of body construction it will influence increase in an car insurance payment.

Accident Claims

The driving record which is pure and free from accidents, will keep much better for you than many tickets and-or accidents.

Prior Insurance Coverage

Your new car insurance company wishes to know, how long you had a continuous insurance as long you co-operated with the previous couriers that stirs you to continue to co-operate with the previous courier.

Credit Rating

It is a lot of clients of the auto insurance companies, have poor, or even any credit history. It directs at reflexions about higher risk and thus, appoint to you higher car insurance premium. Supervise the estimation of credit status to receive the best account. The best account of the credit will save on auto insurance premiums.

Occupation

The auto insurance companies by means of statistical data have found correlation between your employment and risk. For example, the person who is engaged in delivery of newspapers is most probable concerns higher risk than the banker sitting at the table all the day long.

Education

People with higher education pay smaller auto insurance premiums.

Years of driving experience

Business use of the vehicle

Whether or not you currently have auto insurance and how high are your limits

Theft protection devices (often results in discounts)

Multiple cars and drivers (another opportunity for discounts)

Coverage and limits

The limits or exposure, clearly affect the cost auto insurance policy. The more insurance coverage you purchase, the higher the car insurance premium will be.

You can study these factors and define that you can make to change your situation. You can save on the car insurance based on these decisions.

The state to guarantee, that the car insurance companies estimate people properly, oblige them to submit the rates to insurance department of each state. In this information they should describe, how they have defined the rates what estimating factors were used, and tariffs which they will use for each location.