When the time comes to request quotes from your car insurance company, you may want to know what factors are actually playing a role in those costs. Insurance companies here in Des Moines have a great deal to think about when assigning pricing like this. Most of those factors relate to the drivers themselves. However, some things are out of your reach in terms of how you can adjust them.
It All Has to Do with Risk
When pricing insurance policies, insurers look at risk specifically. The biggest factors impacting risk that you don’t control have to do with the security of the overall vehicle. Companies use thousands of data points and previous claims to gauge risk in areas like the following.
Your City’s Risk Factors
One of the biggest concerns to insurers is how likely it is for the vehicle to suffer damage or be involved in an accident. Where you live and work plays a role in this. You are not likely to move just to live in a community with a lower risk level just for insurance reasons, of course. Yet, if you live in an area where the crime rate is higher, chances are good your rates are a bit above average.
It’s not just about your city, though. In addition to this, insurance companies use statistics to determine how safe your neighborhood is. If you live on a busy street by an intersection that’s constantly seeing rear-endings, that’s going to raise your rates some as compared to living in a quiet portion of West Des Moines.
When it comes to location, insurers look at the overall crime rate in the area to determine risks associated with theft and vandalism. They also look at traffic accidents and common claims in the city to determine risk levels.
Your Car’s Risk Factors
It’s a great idea to know how much auto insurance is going to cost you before you actually buy a vehicle. Most people, though, are after a specific style of vehicle. From that standpoint, you can’t really control the costs related to your vehicle specifically.
For example, some vehicles are expensive with a higher value than others. The more value, the higher the amount of risk to the insurance agency. Some vehicles may not seem very valuable, but they may be hard to replace. For example, a 1970’s vehicle may have parts on it that can’t be found readily. This makes it more expensive to replace or repair after an accident.
Another key factor here is the type of car. Passenger vehicles and minivans tend to have a lower price point than an SUV. The larger that car, the more expensive and dangerous it can be. Also, if you have a sports car, chances are good you’ll spend a bit more on car insurance. These vehicles are commonly driven above speed limits. Insurance companies factor that into the cost they charge you.
Your Demographic Risks
It sounds a bit out of line, but insurance companies also have to consider you – your age, gender, and marital status. They use data to determine who is most at risk here based on claims filed previously. Young men, for example, typically get charged a higher rate for insurance because they are more likely to be involved in accidents or to drive recklessly. Married couples are less likely to be in such situations.
All of these factors come together to help determine what you’ll pay for auto insurance. Keep in mind that this is just the initial component of the data used. Insurers use specific information about you, as a driver, to influence their decisions as well.