What is Auto Insurance Premium?
Auto Insurance Premium can be purchased for cars, trucks, motorcycles, and other road vehicles. It provides financial protection for motor vehicles in case of:
Physical damage from an accident
– Damage sustained from things other than traffic collisions.
– Theft of the vehicle.
– Protection against liability caused in an accident.
Types of Auto Insurance Premium coverage:
There are 3 main types of auto Insurance-Premium coverage. These include (TPO) Third Party Only, (TPFT) Third Party Fire and Theft, and (Comp) Comprehensive.
TPO coverage only covers claims made by third parties. TPO will not cover damage to the driver’s vehicle.
TPFT Insurance-Premium coverage will cover the drivers’ car in the case of fire and theft, along with claims made by third parties.
Then there is Comp Insurance-Premium.
Comp Insurance-Premium will cover damages to the driver’s car as well as third parties in the event of the accident. Fire and theft damage is also covered under this car Insurance-Premium type.
When should you file the claim with the auto Insurance Premium? Knowing when and how to file a claim with your auto Insurance Premium can be a bit confusing at first. First, you should consider the cost of the actual repairs needed for your vehicle and the cost of your deductible. If your deductible will end up costing you more than to pay for the repairs yourself, the logical choice would be to pay for the repairs yourself and save a couple of dollars, along with the chance of your Insurance-Premium rate increasing. But be advised most car Insurance-Premium companies insist on being aware of any damages made to your vehicle. Though there is no law stating you must report all accidents to your Insurance-Premium company.
You must advise your car Insurance-Premium company if there were any other cars involved in an accident and/or if you had any passengers in the car with you. This is the best way to protect yourself in case the passenger or other party files a claim against you with your Insurance-Premium company. It’s better to be safe and get your side of the story on record with both a police or traffic officer and your Insurance-Premium company.
Factors considered in determining the Insurance Premium rates:
Mainly, factors help insurers form a composite look at their customers and evaluate which ones will cost them money through higher than average claims rates. These are:
– Vehicle type.
– Driving record.
– Accident history.
– Annual mileage.
– Marital status.
– Credit score.
Who is eligible for cheaper rates?
Typically people who on average cause fewer accidents, report fewer claims, and cost insurers less money pay cheaper rates. These are:
– People over 25 years old.
– Married People.
– Live in a rural area.
– Have no chargeable accidents.
– Have no moving violations.
– Drive a car with a good safety record.
– Drive an older, less expensive car.
– Drive fewer than 10,000 miles per year.
– With a high credit score.
TIPS for saving with auto Insurance Premium.
The first money-saving tip is to compare prices. Price comparison can be very time consuming but can save you hundreds of dollars in the end. Don’t just settle on the first Insurance-Premium company you talk to, that’s what most companies hope for and helps them to be able to keep their prices so high. An easy way to conduct a price comparison is by checking the consumer information given by your state’s Insurance-Premium department. The manuals have different coverage levels you need, along with the rates from major companies.
You can also request to increase your deductions rate. When you get into a car accident the Insurance-Premium pays for the vehicles to be fixed, minus your deductible amount. The higher deductible you pay, the lower your premium payment will be.
If you own an older car that is only worth around $1500 or less, choose to omit comprehensive coverage. If your car is totalled you will most likely receive less for your claim then you ended up paying for the coverage. Expensive and more luxurious cars, especially sports cars, cost more to repair and have a higher theft rate. This, in turn, will cause the cost of your car Insurance-Premium to skyrocket. So instead of forking out all that extra money for a car which in the end will cost even more in car Insurance-Premium, by a more modern car. You will save on gas and your Insurance-Premium rates.
Many car Insurance-Premium companies also offer low-mileage discounts. These discounts are given to drivers whose cars mileage is lower than the average miles on cars of that year. This average mileage for a vehicle usually equals around 15,000 miles a year.
Another tip is to think about Insurance-Premium costs before you take any actions. Insurance Premium rates are more likely to be higher in urban areas where the crime and traffic rates are higher, compared to country type areas. Lastly, ask about additional price reductions or discounts the Insurance-Premium company offers. Each company may have different discounts available depending on the mainstream of people they cater to. These can include combined home Insurance-Premium which will allow you to have lower car Insurance-Premium, multiple car discounts, good driver and student discounts. It never hurts to ask what types of discounts are available. You could end up keeping a couple of extra dollars in your savings account.
Things that affect your auto insurance premium
Auto insurance premium rates differ according to many factors. The mileage of the car, together with the year and model affects the amount of the insurance premium. If your car is expensive or brand new, it will be more prone to getting stolen. Therefore, insurance companies charge this at a higher cost. Any modification you put into it will also affect the amount of the premium. If you upgrade its engine, it will more probably run faster. With an increase in speed, insurance companies will think of it as, again, with a higher risk of getting involved in accidents. You can use alarms and safety devices for modifications instead. This way the cost of the premium will get lower. Though not that big, it will still help.
The gender of the driver also has something to do about the insurance premium cost. Realistically, insurance companies offer more affordable insurance premium to female drivers for the reason that women are more careful in driving. According to statistics, they are low-risk drivers when compared to men. They don’t usually get involved in road accidents or road violations, unlike men.
Young drivers who are in their teenage years are also charged with a higher insurance premium. They are more likely to get into an accident because they have less experience, drive too fast, don’t follow road rules and is often getting traffic tickets, and more. For that, the teen can enrol to a defence driving course. If the course is completed, the insurance company will most likely reduce the premium cost.
Male drivers who are in their early twenties are also charged with a higher premium. They lack in driving experience and so they are more prone to getting into trouble, Sometimes, they are becoming more aggressive in driving that they end up racing another car. Female drivers in this age group also have higher insurance rates.
So what can you do to lower your car insurance premium? For teens, aside from enrolling in a driving course, their parents may include them in their policy and not make another plan for them. Encourage them to study well to get good grades because this is also favoured by insurance companies. For other drivers, the best thing to do is to maintain a good driving record.