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| What factors determine your car insurance rates? |
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You may be surprised!
You may be surprised at the various factors that go into determining your car insurance rates. Quite often consumers have misconceptions. If you act upon false information you may be costing yourself money!
Smaller towns may have higher rates
True Story: The customer moved from the small Southeast Missouri town of Dexter, MO to Cape Girardeau (the largest city in the region)
Mr. Customer new that he was supposed to notify his insurance company of his address change. But he delayed the call, assuming that the move would make his rates go up. He waited and waited, finally 8 months later he informed the agent.
Result: His car insurance rate decreased by $240 per year!
Why? This customer did not realize that accident rates in the small town were much higher per capita than the new larger town. If he would have made the address change sooner, he would have saved even more money!
Other Surprising Factors that determine car insurance rates
Credit and bill payment history Although not used by every insurance company, most will use "insurance scoring" to help determine future expectations. The theory is: customers who pay their bills on time are less likely to have claims.
Recommendation: If you think (or know) that you have bad credit, let your agent know during the quoting process. Your agent can try to use companies that don't rely on this factor.
Not at Fault Accidents Of course an at fault accident will increase your insurance premium, but so can a Not at Fault accident. More and more companies are using this factor (especially if you have more than 1) to predict future claims.
Recommendation: If the damages are small, you may allow the at fault motorist to reimburse you personally and therefore leave the insurance companies out of the equation. Make sure to consult a trusted agent before taking matters into your own hands. But this method could save you and the other driver tons of money on your premium over the next several years.
A $0 claim will raise your rates If you suffer damages that fall below your deductible and make a claim, you will be the only one making any payments. Although the insurance company doesn't actually pay for anything, by filing the claim in the first place you will land yourself on a CLUE report. This report will reveal your accident and cause your rates to increase.
Recommendation: If damages are small and don't involve injury, consult a trusted agent before filing a claim. It is possible that paying a little extra out of pocket now, could save you big bucks down the road!
* All insurance recommendations are based upon general circumstances and should not be considered as advice. Please consult a licensed insurance agent in all situations.
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