Factors Car Insurance Companies Consider and How They Affect Car Insurance Rates

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You own a car, and you know that the next step you should do is to get car insurance. The most often asked questions are: “What must you look into when getting insurance?”, “How will you know which type of insurance you should get?” And of course, “How can I get cheap car insurance?”
To answer those questions, you should know what the car insurance companies look for in customers, because ultimately, it is the company that decides whether to give you insurance or not.
Insurance companies actually look into several factors when people apply for insurance. For one, gender is a factor that may determine how low or expensive you must pay. Females are generally given more favor over males. This is because according to driving records kept by the companies as well as general surveys; women are less likely to overtake, over speed or drive drunk. Women are also more obedient to traffic rules and signs. Simply put, women are more careful drivers than men. And so, women pay lower insurance rates than their counterparts.
Another factor of significance to companies is the driver’s age. Again, based on records of companies, there is a certain age group, members of which companies deem to be safer drivers than the rest. This specific age group, aged 40 to 50 years of age are considered to be the safe drivers. This is because they are deemed to be matured, unlike teens, and more physically adept than those with ages ranging from 50 years and above. The implication of this is that you would be more hard pressed to get cheaper car insurance for those not belonging to this “safe drivers” group.
Also of utmost importance to insurance companies is the driver’s driving history. One who has had bumped fenders and speeding tickets to his or her name, or worse – accidents, will likely pay higher rates than one who has a clean record.
And of course, the vehicle itself is something companies never miss. Older models often entail cheaper rates than recent models. Newer models, however, most often are the ones with the necessary anti-theft and safety devices that older models do not have. You could actually get discounts from such devices, and so it would be wise to fit your vehicle with such devices.
Once you understand these concepts, it will be quite easy to get cheap car insurance. You should then have no problem taking these to advantage in getting the best insurance for your vehicle.

Factors Car Insurance Companies Consider

Can My Car Insurance Company Really Do Anything They Want to My Insurance Rates?

When you’re going head to head with your car insurance company to negotiate your insurance rates it’s easy to feel like you’re dealing with an omnipotent being with the freedom to do just about anything they want. After all, it’s pretty hard for you to see otherwise! They do a good job of letting you know it’s their way or the highway (or not, as the case may be-most states aren’t going to let you out on the road without decent insurance coverage). What they don’t tell you is that they’ve always got someone watching their every move the way they’re sitting there watching yours.
Every state has an insurance department (or insurance bureau, or whatever name they decide to give it). That insurance department does two things. First, it monitors the insurance companies (including health, life and auto insurance companies) to make sure they’re walking the straight and narrow and aren’t setting car insurance rates higher than state drivers can afford. I’m not sure what the actual algorithm is that they use to determine how high they’re going to go, but they do make sure car insurance companies aren’t given a completely free reign.
State insurance departments also exist to keep consumers educated on insurance issues in and around the state, which brings us to part two of how insurance companies stay in line-competition and a limited pool of consumers. Long gone are the days when consumers only had one choice with regard to their insurance. There are over 50 companies currently doing business in the U.S., and that’s just talking about companies with a national reach. There’s very little data on the number of small, local insurance companies that have managed to hang on to enough drivers to stay in business.
When you’ve got more than one car insurance company competing for a driver’s business you’re going to walk right into a pricing war. Every company offers their own services, but those tend to work in a very small square of offerings. For example, just about every company you talk to is going to be able to provide you with comprehensive, collision and liability, as well as emergency roadside assistance, rental insurance and additional medical coverage.
And when you get right down to it, that’s really all the average driver with an average (non-collectible) car really needs.
With very little difference in offerings from one company to another consumers are going to look to the next thing on their priority list-the price. The car insurance company with the highest insurance rates probably isn’t going to be the one that brings home the bacon (the largest number of drivers insured by their company at the end of the day). Drivers, especially in today’s restricted economy, are looking for ways to save money, not spend more. If they really let their rates go flying they’re going to be out of business before too much longer.
So between state regulatory organizations and consumer demand car insurance companies are just as restricted in how high they can raise their rates as any other business. It’s just not always apparent until you do a little digging.

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