Factors that Influence Car Insurance Price
Here’s a question for you: is it true that red cars cost more to insure than other car colors? If your answer is yes, then you need to read this article. The truth is, colors really don’t affect the price of your car insurance; however, if your red car is a Porsche 911 Carrera, then chances are you’ll pay a heftier price compared to insuring a red Kia Pride.
People have a lot of misconceptions about car insurance prices. Car insurance is there to protect you in case something happens- and believe us, unpredictable things happen all the time. The only control you have is knowing that you have a financial safety net in case something does go awry.
And since we understand how hard it is to earn money these days, we’re giving you some factors that influence a vehicle’s insurance price so you can learn how to lower your car insurance payments.
Location and driving habits
Do you live in a rural area? Chances are, your insurance rate is lower because of little to no traffic (lucky you). However, if you live in urban areas, then you have a much higher risk of getting into collisions, accidents, and car thefts. In this case, your insurance rate will get substantially higher.
Also, the distance you travel each day and every year, your purpose for using your vehicle (whether you’re using it for personal or business reasons), and the number of people you allow to drive your car are factored in when calculating your insurance price.
Gender and age
Statistics show that teenage boys are more likely to get in a car accident than teenage girls. So what this means is that the former pay higher insurance rates than the latter. Interestingly, older men drive safer than older women, so everything gets reversed.
Another important element that influences the price of your car insurance is your driving history. Your years of safe (or reckless) driving will actually come in very handy when you apply for a car insurance.
In fact, you can earn quite a number of good deals and discounts just by having a clean driving record to brag about. Reversely, the more accidents, violations, and claims you have had in the past, the higher your insurance prime will be.
Are you married or single? Married people (especially men) experience fewer accidents compared to those who are single. Therefore, their car insurance rate is typically lower.
However, keep in mind that it can easily be affected by your driving record (which is the reason why we keep stressing this in the first place), so if you have previous vehicular accidents and charges, then your car insurance price goes up.
Generally, the less expensive vehicles are much cheaper to insure, especially if they come with great safety features. Your car’s make and model are also taken into consideration, since insurers look at the car’s repair cost and how easy it can be fixed in case you get in an accident.
And speaking of safety features, car insurers also assess how prone your vehicle will be to theft. There are some cars, particularly luxury and rare cars, that are “hot” in the black market, so expect a higher insurance price for these types of vehicles.
You can get a good discount from your insurers and enjoy a much lower insurance price by installing anti-theft features (such as a good alarm, GPS security systems, and etc.) in your vehicle.
As a side note, we think that the more cars are upgraded for safety and comfort, the more auto insurance prices will drop in the near future. This is especially true for safety technologies that feature advanced security, such as automatic braking, telemetrics, and many others.
With all things considered, sometimes, a low price may not really be the best one for you. Low-priced insurance rates are often limite, and you may have to pay more if you encounter an incident that isn’t covered by your insurance. For instance, if you get in an accident and damaged the fence and gate of a nearby home, the court may demand that you pay P70,000 for all these damages.
Here’s a breakdown of all the expenses:
How much you need to pay: P70,000 Your insurance coverage for damages to property: P40,000 How much will your insurance pay: P40,000 How much will you need to pay on your own: P30,000
If your insurance coverage here is P100,000, how much will you take out from your own pocket?
Your insurance coverage for damages to property: P100,000 How much will your insurance pay: P70,000 How much will you need to pay on your own: None
At the end of the day, it’s really about peace of mind. It’s about knowing that you’re protected and secure no matter what life throws your way. Your car insurance simply reflects how much importance you place on these things in your life. Choose those that help you save more in value than in price. Make sure to choose an insurance package that will give you the best options that your money can buy.