When you apply for auto insurance, it goes through a process called “underwriting.” During this process, the insurance company does several things. It reviews your application, looks at your driving record, and examines other factors to determine if you meet the insurer’s guidelines to receive an insurance policy.
Not all insurance companies have identical underwriting guidelines. However, some of the most common factors used across the board include your driving record, where you live, the type of automobile you drive, and how many miles you drive on an annual basis.
Factors That Impact Insurance Rates
We’ve discussed the most common factors that determine a driver’s insurance rates, but that was only a limited list. Let’s take a closer look at what factors impact auto insurance rates, which include:
- Your driving record (moving violations can lead to increased insurance premiums because you can be considered higher risk).
- Your age (statistically, younger people get into more crashes so they cost more to insure).
- Your marital status (married people often get discounts because they get in fewer accidents than their single counterparts).
- Your gender (historically, males file more claims because they are riskier drivers, especially males under the age of 25).
- Your credit score (bad credit can lead to increased premiums because people with poor credit are more likely to commit fraud).
- Where you live (if you live in the city, you can expect higher insurance premiums than if you lived in a rural area because there are more claims filed in cities and suburban areas).
- The type of car you drive (the more expensive the vehicle, the more to insure).
- How long you’ve been licensed (newer drivers usually pay higher premiums because they have a higher risk of an accident).
- Any history of DUI or DWI (a DUI will lead to skyrocketing insurance premiums).
- How many miles you drive (the more you drive, the higher the risk of a crash, so more miles usually means higher premiums).
Next: How Car Accidents Affect Car Insurance Rates
To file a car accident claim in Columbia, South Carolina, contact the Law Office of James R. Snell, Jr., LLC. Call today to learn more!