A Big Part of Your Car Insurance Risk Profile Is Out of Your Control
There are a number of factors that go into how car insurance companies assess risk, and this process also determines how much you pay for car insurance.
Many of these factors you have some control over, but some you don’t. It’s a good idea to familiarize yourself with the process of risk assessment so you can understand your insurance payments and find more affordable car insurance if necessary.
No matter what, there are still ways to save and get the best coverage for the best price.
What is your driver risk?
“Preferred risk” drivers usually qualify for better car insurance rates, because a car insurance company has determined that they present the least amount of risk, according to Fox Business.
Preferred risk drivers typically:
- Have a safe driving record with no accidents, tickets, or other violations
- Have good credit history
- Don’t have a history of filing claims
Other factors that influence a driver’s risk profile include vehicle type and purpose, where you live and drive, and yearly mileage.
Car insurance companies have two other categories for drivers—standard risk and high-risk.
A standard risk driver has typically been involved in an at-fault accident, has an average credit score, received a ticket for minor traffic violations, and might have had to cancel car insurance because of missed payments.
High-risk drivers tend to pay the most for car insurance. These types of drivers are usually under 25, have had one or more major accidents, and numerous tickets or violations.
How your age affects car insurance costs
The one big car insurance risk assessment factor that you have no control over is your age.
Those who are 25 or older have a better chance of being a preferred risk driver. In fact, if you’re under 25 or never had car insurance before, you’re more likely to be categorized as a high-risk driver.
Other personal factors that can influence your risk profile include marital status and even gender.
Although there are things you can’t change, you can lower your rates by improving your credit score or maintaining good driving habits. There are options and discounts available that can help you save costs.
Drivers at any age can still save on car insurance
The good news is that full-time students under the age of 25 with good grades may qualify for a discount on car insurance. If this is you, ask your car insurance company if they offer a good student discount or any other reductions.
If you want more ways to save on car insurance, Jerry can help. Comparing quotes is another way to save money on your car insurance.
The free app can help you find the most affordable car insurance and the best coverage by comparing quotes from up to 45 different insurance companies in under a minute. Jerry has no long forms and keeps you updated with new competitive rates before policy renewal. You’ll always have the most affordable option for the coverage you need.