Obtaining car insurance is not only a legal requirement to purchase or lease a vehicle, but also a safety measure for you and your family. While obtaining the best quote may involve ample time and research, the end definitely justifies that time. It is important that you understand the terms of coverage because you certainly do not want to compromise price for coverage. For this reason, information and education is key when it comes to getting affordable automobile insurance.
Although you may not realize it, one of the long-term benefits of having car insurance is actually financial security. A reasonable payment each month, will rule out an astronomical payment one day, which may imply bankruptcy. Without proper automobile insurance coverage, you can be accountable for the cost of your vehicle and/or someone else’s vehicle in the case of an accident, significant losses from theft and vandalism, and the fines and penalties associated with not having car insurance by the state.
So what are some of the things that car insurance companies look at when analyzing a quote and attaching a price tag to it? Here they are:
Age and sex of the driver – usually women are considered to be safer drivers than males, and in general people under 25 years of age are more likely to get into an accident than those above age 25.
Make, year and cost of the vehicle – the condition and type of vehicle are very important in determining the reliability of the car. The safer the automobile, the lower the risk. As for price, a cheaper vehicle will typically cost less to insure than a top of the line luxury vehicle.
Driving Record – moving violations and speeding tickets imply a greater risk of getting into an accident.
There are many other factors that automobile insurance companies look at including your credit score, marital status, occupation and education. However, the one common denominator is the level of risk. The rule of thumb is the higher the risk, the higher the car insurance premium can be.
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