You’ve probably heard that where you live makes a difference in how much you have to pay for auto insurance. Why is that? There are lots of reasons but it helps to understand how companies determine what rates to charge their customers. To understand this, you must look at the auto insurance factors that come into play in determining that rate.
Let’s take a look at how the crime rate in your area, and other factors, impact your auto insurance rates.
How Do Crime Rates Impact Auto Insurance Rates?
The one thing to remember is that auto insurance companies focus on risk. The simple equation is: the higher the risk of damage to your car, the more you are going to pay in monthly premiums.
Insurance companies are data driven and using your zip code they can determine the level of crime in your area. If it’s high, for instance if there is a high level of vehicle theft or vandalism, you can expect higher auto insurance premiums.
So, while two drivers may be comparable on many factors, if one lives in a higher crime zip code, they will be charged more to address the higher risk area.
But theft and vandalism aren’t the only factors. Let’s look at other auto insurance factors that determine your rate.
Drivers who have a clean record, with few or no accidents or incidents, will pay less for auto insurance because they are considered lower risk drivers. Things that can drive your auto insurance rates higher include:
- Previous accidents
- Speeding tickets
- Drunk driving
- Filing claims
Population density plays a big role in the world of risk. Basically, the more people there are, the more likely it is that accidents will happen. Therefore, accident rates are higher in cities and city-dwellers must pay more for auto insurance.
Other factors that insurance companies consider when determining your monthly premiums include:
- Age – Younger and older drivers pay more
- Gender – Men usually pay more than women
- Mileage – High mileage drivers will pay more
- Vehicle Type – Fast sports cars will cost more to insure than family sedans
How To Save Money on Auto Insurance
So how do you get around having to pay high rates, even if you live in a high crime area?
Installing an anti-theft device is a great way to reduce your premiums in any area. Insurance companies will offer a discount if you install theft prevention devices.
Make sure you are taking advantage of any other discounts you may qualify for also, including student discounts, safe driver discounts and membership in organizations such as AARP.
The best way to make sure you are paying the lowest rate is to shop around. Comparing rates from several carriers remains the best way to save money. InsuranceWins is here to help. To find out about auto insurance rates in your area, use our simple form to start receiving quotes today.