The costs you pay for all insurance products depend on the risk level you are to the insurance company. You may never know the exact risk you are to an insurance company, but you can learn more about your risk level for auto insurance by understanding how insurance companies determine risk levels. Here are the factors that most insurance companies use to assess risk when providing auto insurance coverage to people.
Your Age and Gender
Your age and gender are two factors you have no control over, yet they can affect your rates. In general, males pay higher rates than females. Men have higher chances of speeding and driving recklessly, and, therefore, they often have higher rates of accidents.
You will pay more for insurance if you are under the age of 25 or over the age of 65. People who fall between these ages generally pay lower rates because they do not experience as many accidents as people over 65 and under 25. People under 25 have little experience behind the road, while people over 65 often have more accidents due to health issues.
Your Driving Record
One of the primary things that affect your risk level to insurance companies is your driving record. Your driving record is a list that contains all your driving offenses. If you get a speeding ticket, it will show up on your driving record. If you get charged with a DUI, it will also show up on your driving record. Auto insurance claims and accidents appear on driving records, too.
An empty driving record is one that has no record of accidents, tickets, or violations. Insurance companies reward these types of drivers by charging lower rates. People with items on their records pay more, as they have higher chances of encountering more accidents, claims, and traffic violations.
Other Details That Affect Your Risk Level
Additionally, insurance agencies gather and use other details about you to categorize your risk level. For example, they may factor in your occupation. People with certain occupations pose higher risks to insurance companies and other pose a lower risk. For example, you might be more at risk if you work as a salesperson. You might be a lower risk if you are a teacher or nurse.
If you feel you are overpaying for your auto insurance, contact an insurance company. You can request a quote over the phone or online, and you might save some money by switching to a new provider.