When you get a quote for your auto insurance, you will be asked about your living situation, driving history, accident reports, and other factors. How you answer those questions determines the amount of “risk” that you represent, versus the amount of “premium” that you will pay. Risk premium is negated by discount, and that means the more discounts you receive from your “base rate,”* the lower your premiums.
Your base rate is also determined through the responses to the questions that you will be asked. This is referred to as “tiering”* for risk, but it acts like a discount, so we will consider it to be one. This site will reveal to you the “correct” answers to those ten questions, and it will immediately save you money. That is why you should study it carefully before you start or renew your auto insurance policy. Keep it as a reference for every time your policy renews, and be sure to update your coverages and discounts as your family circumstances change.
Each state has decided what rating factors, discounts, and fees may be used, and which may not. Insurance companies do not determine these factors, as is commonly believed, but they in fact respond to them. Once a discount is allowed, it will soon be offered. If a fee is allowed, most likely it will be charged. It is the same with many rate tiering factors, such as the much despised “credit-based insurance score.” This and other factors affect the total risk assessment, or “underwriting”* that you represent to an insurance company.
The list below is what many car insurers look for to assess your risk rating. Take a look to see how risky – or safe – you look to the insurance company.
- Driver’s record (accidents and tickets indicate recklessness)
- Steady job (your ability to pay)
- Home ownership or long-term rental (sense of responsibility)
- Age (younger drivers are considered riskier)
- Sex (females tend to be considered safer drivers…sorry guys
- Married or Single (married drivers get lower rates)
- Type or Class of Vehicle (motorcycles, sports cars, etc… are considered higher risk)