When you’re looking at your monthly Atlanta car insurance payment, you might wonder how exactly the insurance company came up with that number. Did they just pick a premium out of the air? We get that it may feel that way, but the truth is that there are many factors that affect the cost of car insurance. These factors can be separated into two categories: details about you and details about your car. We’ll explain how insurance companies set car insurance rates.
What factors affect the cost of Atlanta car insurance?
Personal details that insurance companies look at.
Insurance companies want to know about you when they’re determining your car insurance rates. They’ll want to know where you live, what kind of driving record you have, your age, and so on. These details matter to your Atlanta car insurance rates because they give the insurance company an impression of how risky you are to insure. For example, they’ll look at the following…
- Age- The older you are, the less likely you are to cause an accident because of experience and familiarity with navigating roads. With age, maturity, and wisdom comes the added benefit of being charged much less on car insurance! (But the other side of that is that young drivers often pay more for car insurance. Atlanta teen car insurance will probably cost more than car insurance for an adult.)
- Marital status- Another problem for hopelessly single people to be worried about – they are more likely to be involved in an accident than if they were married. You can thank the National Institute of Health for the research. They found in a 2004 study of 10,525 adults that drivers who never married had double the risk of driving-related injury as a driver that was married. Their intent was to investigate the association of marital status with risk of motor vehicle driver injury.
- Driving Record- If you have a history of a series of automobile accidents, you will probably pay substantially more than someone with a clean record. There are many benefits to being a safe driver, and car insurance rates are one of them!
- Credit History- Your credit score may be a useful measure of how financially responsible you are. Good credit scores help establish credibility and are associated with low-risk behaviors and better financial decisions. Since a good credit score establishes you as a sensible individual, it can help lower your rates. Plus, people who maintain control of their finances are perceived as responsible and more than likely to complete payments in a timely manner.
- Location- Where you live can alter how much you pay. A small, quiet town is going to have significant differences in car insurance prices compared to a loud, sleepless city. Living in a busy urban environment comes with certain risks – such as security, theft, and potential damage to your vehicle. That is another component that going to influence how much you are going to pay.
What details about your vehicle determine car insurance rates?
While details about yourself, such as your driving record and where you live, play a part in determining your car insurance premium, there is additional information that insurance companies need to calculate your car insurance rates. They also use details about your vehicle to figure out what your rate will be. The following are some of the more car-related factors that influence your Atlanta car insurance rates:
- Year, make, and model of the car- The amount of coverage you will want on your car varies greatly depending on the type of car you drive. Car insurance companies use year, make, and model of your vehicle when calculating your premium because that gives them a good idea of the vehicle’s value.
- Purpose- Why is it exactly that you’re using this car? Is it a secondary luxury car you use on weekends or is it used to fulfill job obligations? Or are you using it to drive to your university campus across town? Insurance companies realize that constant use is going to increase your risk of getting into an accident.
- Mileage- The question of how much you drive matters because more mileage each year increases the probability of a wreck.
- Legal Obligations- Should you be at fault if an accident occurs, there is a possibility that you be may end up getting sued. This is precisely why auto insurance exists with plans that account for collisions. Different types of coverage include bodily injury liability, personal injury protection, property protection liability, collision/comprehensive coverage, and uninsured/ underinsured motorist coverage. To ease your mind and get a sense of peace, it would be advised to safeguard yourself and your assets with a more advanced level of coverage.
- Safety Features- Does your car contain recent vehicle features such as anti-theft protection? Is it a hybrid vehicle that can use alternative fuel? Can this vehicle protect you and keep your passengers safe should an accident occur? Your insurance company may inform you that you qualify for certain rewards!
- Potential Damage- It is important that the driver and occupants are protected, yes. However, insurance companies also calculate how much damage your car can exact on another vehicle should a collision occur.
- Cost of Repair- Sure, feeling the wind on your face while behind the wheel of a brand-new model or exotic car with a fast engine is exciting when it’s yours, but keep in mind these parts are both expensive to replace and attractive to thieves.
- Who else will be driving- How many members in your home drive? If you live with someone who’s legally able to drive and who will be borrowing your car (such as a family member or roommate) they should be documented and listed on your policy.
These details are essential to insurance companies when they establish your automobile insurance premium. Details about your driving habits and, well, yourself help them figure out how much a risk you are to insure. Recorded data and statistics help them determine not only the value of the vehicle but how much it would cost if the vehicle needed to be replaced. And all of these things together factor into your Atlanta car insurance rates. So, no, your car insurance premium isn’t just an arbitrary number they pick out of thin air. There’s a lot of reasoning that goes into it.
If you’re looking for car insurance in Atlanta, we can help. Our team of insurance experts can help you shop for the best insurance at the best possible rate. By getting multiple quotes, you can save money on Atlanta car insurance. You can get started with your Atlanta car insurance quotes by filling out our online form or calling us today.