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Important Factors That Affect Auto Insurance Costs

Insurance companies do not provide random numbers when asking for premiums. Each company uses a series of algorithms and statistic data in order to compute rates. And they take into account numerous factors. Some of these factors are under policyholder’s control, allowing him a degree of cost management. If you want to know that most important factors that affect auto insurance costs, read the following post. Also, you can get free online auto insurance quotes from our website and you can use them to compare prices.

cash and auto insurance policyYou location is highly important for any insurer and it is usually the first asked question.  Rates are highly influenced by the geographic and demographic profile of an area. Living in a highly populated, urban area, where jamming, accidents and insurance claims are more likely to happen, will make the insurance rates higher, when compared with living in rural areas. Car theft rates and unemployment within a certain state are also 2 major big concerns for any insurer.

Age and gender are also extremely influential.  Logically, very young drivers cost more to insure. Lack of experience, correlated with some youngster specific behaviors make the costs pretty steep. Adding a young driver to your policy will make your premiums rise, sometimes with more than 50%. People between 35-65 years are considered safe drivers, with plenty of experience behind wheel. Prices start to increase, based only on age, after 65 years old. Elderly present a series of specific medical conditions that will affect their driving capabilities.

Policyholder’s driving record is also extremely important. Any insurer wants to know the background of any customer. They will ask about past traffic violations, graduated defense courses and other relevant data. When you are presenting these data it is important to tell the truth and nothing but the truth.

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