5 Things That Can Increase Your Car Insurance Rates
Insurance companies hire actuaries who spend most of their time looking at statistics with the purpose of predicting if someone will end up filing a claim or not. At the same time, statistics are used to justify the higher policy premiums.
While some criteria that will increase car insurance rates are quite obvious, like driving record, others are not. We will focus on this in the following paragraphs thanks to information from a prominent Las Vegas personal injury lawyer.
1. Credit Score
Most people do not know this but insurance companies determined the fact that individuals who have a lower credit score are much more likely to be involved in accidents than those who have a higher credit score. This is why your credit score can lead to higher insurance rates. However, there are states, like California, in which credit scores cannot be used by insurers to set their rates.
2. A History Of Claims
It might be simply due to bad luck but this does not matter in the eye of car insurance companies. When you have a history of making claims because of whatever reasons, premium rates can go up. This is because insurers might think that you get into more accidents because of how you drive, not necessarily because of something else that might have happened. Fortunately, though, this does get cancelled in time and rates do go down if you are not involved in any accident for a period of time.
3. Car Horsepower
Car owners expect to have to pay more when they buy a sports car. They know that the insurance rate for something like the Porsche Carrera will be higher than for a Toyota SUV. What they might not know is that buying a Camry with 6 cylinders is going to bring in a higher insurance rate than one with 4 cylinders.
Generally speaking, four-cylinder cars that have moderate horsepower will cost less than 6 or higher cylinder cars. You can use an online car analysis tool designed for determining insurance premiums to see such small differences.
4. Your Job And Education
Car insurance companies saw a link between claims and education. Statistics show there are fewer claims coming from individuals with more education levels completed. Every single level is actually going to lower the insurance rate, even by only a little.
In a similar way, the job you have can influence rates. For instance, executives and lawyers tend to have the best insurance rates. The blue-collar workers usually have the worst rates.
5. Your Hobbies
Last but not least, people who often race cars, motorcycles, go hang gliding, or skydiving can expect to have a higher car and life insurance rates. As rates are set, the insurer is going to ask some questions. Based on the answers, if it is determined that you are a person who often engages in risky activity, the rate offered becomes higher. And you cannot lie on the questionnaire since if the insurer finds out, you can be denied your claim when you need it the most, after a car accident.