Factors that affect the price of auto insurance

For many things that we want to buy, many factors influence it. This is why it is possible to get a car for 10,000 USD and it is also possible to get a car for 1 million USD. The same applies to many other products in the world today. You might want to get auto insurance and you are wondering what factors could influence the price for auto insurance. This article will discuss some of the factors that affect auto insurance prices.

Age and gender

Young males are often charged higher than any other age group when it comes to auto insurance. This is considering auto insurance also considers risk when estimating their charges. Generally, male teenagers are involved in auto accidents more than female teenagers. Hence, male teenagers are charged higher than female teenagers. Female teenagers are charged higher than older women and older women are charged higher than older men. Hence, the order for premium costs from least to highest is older men, older women, young females and young males. However, the difference is the price is often not significant.

The Insurance company you are using

Like every other business, some insurance companies charge more than other insurance companies. Hence you might want to compare charges among insurance companies before settling down for a particular insurance company. One of the best ways to compare insurance companies is by reading reviews. Hence, if you want to patronize Lexham insurance for example, you can read Lexham insurance reviews to know what people have to say about the quality of their services and their price. Same with other insurance companies on your shortlist before you finally conclude.

Marital status

It is generally believed that single individuals have more accidents than those who are married. Therefore, getting married especially when you are a man would mean your rates could be significantly lower than when you are not married. However, other factors would still be considered such as your driving history. If you have never had any accidents and you get married, your rates could reduce by as much as 50 per cent.

Area of residence

The area you live can also affect how much you pay as premium costs for auto insurance. Most accidents in traffic are said to occur close to the home of an individual. The implication is that if a person lives in an environment where there are a lot of cars, it is believed that they are at a higher rate of being involved in accidents than if they live in an environment where there is lesser traffic. High traffic residential environments are also believed to be at a higher risk of collision with injuries and theft. Furthermore, the area you live could significantly affect how much it would require fixing your car if the need arises. Hence, auto insurance companies also fashion it into their score.

Credit score

Your credit score is often considered when the premium cost you should pay for auto insurance is being calculated. Good credit scores would mean lower rates and poor credit scores will mean higher rates.


Your profession is also mostly considered when premium cost for auto insurance is being calculated. It is believed that some professions such as journalists and delivery drivers use the road more frequently than other professions, and hence, are at a higher risk of being involved in an accident. Furthermore, some professions such as insurance underwriters, nuns, paramedics, and police officers are believed to drive more carefully than most average drivers, implying that they will get lower premium cost.

Safety rating

The safety rating of a vehicle, when it is high would result in a lower premium cost compared to when it is lower. This is because there would be a lower risk of being involved in an accident or the insurance company having to pay the medical bills of your passenger. On the other hand, if the safety rating for your car is low, then you will get a higher premium cost. Some factors that could be considered while considering the safety rating of your car include traction control, automatic seat belts, and airbags.

Size of vehicle

It is believed that a larger car is mostly safer when involved in an auto accident than a smaller car. The implication is that bigger cars have better safety ratings and lower premium cost than smaller cars. When it comes to the engine size, cars that have larger engines when compared to the size of the car’s body have higher premium costs. This implies that a sports car that has a V4 engine will have significantly lower premium cost compared to the same car with a V8 engine.

Car Age

A car’s age can significantly determine how much premium cost the owner is to pay. This is because older cars are mostly replaced when they are involved in an accident than newer cars. The major reason for this is that the price of fixing the old car can sometimes be more than the actual worth of the car. So the owner might drop the collision coverage and decide to save for another older car. Newer cars cannot be discarded and replaced like older cars, requiring the insurance company to pay for the repairs.

Chances of theft

People who live in areas where there is a high rate of car theft and/or have an attractive car that has a high risk of being stolen pay more premium cost. A car with a high risk of being stolen could be determined by looking through the most stolen list of cars and seeing the number they are. Hence, you are likely to be paying more for auto insurance if your car is among on the top 10 list of most stolen cars.

Driving history

If you have been driving for some time and have a clean driving record with no accident or tickets, you will pay lesser for auto insurance than if you are completely new to driving or you have been involved in an accident in the past.

Driving activity

The more frequently you are on the road including the roads you drive on frequently can also be considered while calculating your premium cost. This is because the more you drive, the higher the chance of being involved in an accident. However, if you don’t drive frequently, you can get a discount.

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