Questions Insurance Companies Ask
- How many miles driven annually?
- What vehicle will be insured?
- Do you own the car?
- Primary use
- Zip code?
- License status?
- Higher education?
- Other drivers in household?
- Owning a home
- Anti-theft devices?
- Driving violations?
- Accidents or claims on record?
- Existing insurance policy
- What level of coverage would you like?
- Optional coverage?
- Home, life or rental insurance?
- Paper statements?
- Final tips
When you buy car insurance, your insurer will ask questions about your demographics, driving record, location, and more. Most of this information you will know without preparation, but some of it you may need to research ahead of time.
Insurance companies ask these questions in order to assess your risk level. This allows them to determine an appropriate premium based on your unique level of risk.
It wouldn’t be fair to charge everyone the same rate—rural drivers vs. urban, young first-time drivers vs. experienced drivers, and people with a DUI on record vs. people with clean slates.
To help you understand what to expect, Jerry has compiled some of the most common questions that you’ll be asked when you purchase car insurance.
How many miles do you drive annually?
Lower mileage means a lower chance of getting into an accident—so people who drive fewer miles are cheaper to insure. The average driver covers 10,000 to 12,000 miles every year.
If you drive less than the average amount, you might be eligible for a discount. Be sure to give the agent an accurate estimate.
What vehicle will you be insuring?
Some vehicle models are associated with higher risk. Sports cars, luxury vehicles, and rare models are typically more costly to insure because the replacement costs are higher.
The age of your specific vehicle, as well as its safety features, can also impact your car insurance rate. In some cases, new vehicles can actually be more costly to insure—even if they have more safety features.
The insurer can look up the individual vehicle history of your car. If there is a claims history or accidents on record, you might be quoted a higher rate.
Do you own the car?
Leased vehicles are technically co-owned by you and the dealership until the debt is entirely paid off. Dealerships sometimes have specific requirements for insurance coverage levels. If you own the car outright, you can choose your coverage as long as it meets the minimum car insurance requirements in your state.
What is the primary use of your car?
You might use your car for commuting to work, while your neighbor might use theirs for off-roading. Some activities are higher risk, and your insurance company needs to know how you usually use your vehicle.
If you typically get behind the wheel to run errands and drive to work, your insurance rates should be about average.
Key Takeaway Car insurance companies need to know more about your specific vehicle and how you use it before they can give you a quote.
What’s your zip code?
Urban drivers are associated with higher risk because they’re more frequently exposed to intersections, pedestrians, and traffic congestion.
Rural drivers typically get lower insurance rates. Companies can also pull specific crime information for your neighborhood to understand how likely you are to experience theft or vandalism.
What is your license status?
New drivers with learner’s permits cannot get their own insurance policies. Instead, they must secure coverage under someone else’s policy, like a parent. People with revoked, suspended, or foreign licenses will face additional challenges with getting insurance.
It’s important to note that almost all drivers must have some kind of legal license, as well as car insurance. If you don’t own your own vehicle, then non-owner car insurance could be a good solution for you.
Are you married?
Statistics show that married drivers tend to get into fewer accidents. As a result, married people usually enjoy lower car insurance rates. And if you both get insurance coverage from the same company, you can save extra money with multi-line or multi-vehicle discounts.
What is your job?
Some professions are associated with lower risk. In fact, studies show that teachers, members of the armed forces, and scientists are the safest drivers on the road. If you belong to one of these professions, you could get some of the lowest car insurance rates on the market.
Have you completed any higher education?
If you’ve earned a bachelor’s degree or higher, you may get a slight discount on your car insurance. This isn’t related to educational privilege, but it does come down to statistics.
There is a correlation between education levels and safe driving behavior, which is reflected in lower insurance rates.
Key Takeaway Your lifestyle can impact your car insurance premium. For example, married teachers in rural areas have some of the lowest rates.
Are there other drivers in your household?
You could get a sizable discount for purchasing a multi-driver policy—but you need to be careful with this question. A multi-driver policy takes into account all drivers and their driving histories. So your quote is the result of averaging the risk levels of all drivers.
New drivers are very risky, so having a teen driver on your multi-driver policy could bump up your rate. If you and your spouse have very different driving histories, it might be worth getting separate policies to save money.
Do you own a home?
Homeowners can get a discount on their car insurance. You may also be eligible for a discount if you live in a condo or with your parents.
Bundling your car insurance policy with home, condo, or renter’s insurance can lower your premium. Plus, it makes the paperwork on your end so much easier.
Does your vehicle have any anti-theft devices?
Anti-theft devices reduce the chance of your vehicle being stolen or damaged and lower your likelihood of filing a claim.
There are two types of anti-theft devices that your car insurance company will ask about. Passive devices, like car alarms, work without any effort on your part. Active devices, like a club steering wheel lock, require you to actively arm them to work.
Aftermarket additions can help bring down your insurance premium, but you may already have some features on your vehicle already. Ask your company to provide a full list of eligible anti-theft devices.
Do you have any driving violations?
A lookback period is the legal amount of time that your driving record is visible to the DMV and insurance companies.
Every state has a different lookback period, usually ranging from 2 years to 15 years. This means that insurance companies are able to look at your driving record and see your driving violations.
Before they actually offer you a policy, the company will pull your record from the DMV. For a simple quote, though, you’ll just need to tell them what you remember about any history of violations.
The more violations you have, the higher risk you are and the higher your rate will be. You can lie to get a low quote, but they’ll eventually find out the truth and you’ll no longer be eligible for that low rate.
MORE: What is a DUI vs. DWI
Do you have any accidents or claims on your car insurance record?
The insurance company will want to know if you’ve filed claims, if they were paid out, and how much you were paid. The type of incident matters because it’s an indication of risk.
If you hit a deer or experienced damage due to inclement weather, it shouldn’t affect your rate too much.
A history of multiple accidents—even if you weren’t at fault—will impact your rate. It shows a pattern, which is exactly what insurance companies are looking for when they offer you a policy. If you’re not sure off the top of your head, this is good information to look up and have on hand.
Key Takeaway Your unique driving history is a major factor when calculating your car insurance premiums. Clean driving records mean lower rates, whereas violations and accidents mean higher rates.
Do you have an existing insurance policy?
A gap in coverage makes you a risky driver, which could bump up your quote. But don’t lie to your agent! Insurance companies need to know your status so they can offer you appropriate coverage.
Continuous coverage is an important factor in keeping your car insurance costs low. To avoid any gaps, consider getting non-owner car insurance to maintain coverage even while you’re not driving regularly.
If you already have coverage, great. This is a good opportunity to ask for a better deal than your current company offers!
What level of coverage do you want on your policy?
You must purchase the basic car insurance required by your state.
This typically only includes liability, insurance, though some states also require medical coverage and uninsured driver protection. Leased cars sometimes have obligatory coverage requirements from the dealership.
If you can afford it, you should always purchase more than just the minimum coverage required. The most popular add-on policies are collision and comprehensive insurance, which offer protection for your own vehicle if you get into an accident or your car is damaged.
And then there’s your deductible. The higher your deductible, the lower your premium will be. But think very carefully about what you can afford to pay out of pocket in the event that you need to file a claim.
Key Takeaway If you can afford it, you should always purchase more than the minimum car insurance required by law.
Do you want any optional coverage?
On top of basic coverage, you can opt for special coverage like classic car insurance or new car replacement coverage.
There is even optional insurance coverage for car sound systems or for specialty equipment, like tractors.
To get an accurate quote, it’s helpful to tell the agent what additional coverage you want. You can always add on this coverage once you’ve done a bit more research—just know that specialty coverage will increase your premium.
Do you need home, life, or rental insurance?
Bundling—getting multiple insurance policies from the same company—can save you money. Many companies offer a healthy discount to people who purchase their home, life, rental insurance, and auto policies from the same provider. It’s good business for them and it’s easier for you.
If you already have these policies but are open to switching if there’s a discount on the line, make sure to tell your agent.
Will you need paper statements?
Your agent may not ask you if you need paper statements, but you should definitely bring this up in your negotiation.
You can often get a discount on your premium for going completely paperless and scheduling automatic payments. If you don’t require paper statements, tell the insurance company and ask for a discount.
A word of warning: don’t lie to the insurance company in an attempt to get lower rates! Companies can corroborate information by looking up your driving record.
When they uncover false information, your initial quote won’t stand up—and some companies will decline to insure you at all.
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