Which Factors Most Influence Auto Insurance Rates?

Regardless of who provides your auto insurance in Lansing, each month you should receive an account statement, either through the mail or online. This statement should provide basic details about your rates, and your rate may go up or down a few dollars every so often. If you compare your rates to a neighbor or friends, you’ll probably notice that your rates aren’t identical. This may lead you to wondering which factors are having the biggest impact on your rates. Insurance companies gather lots of statistical data, and use that data to determine which factors make drivers less likely to be involved in accidents.

Age

As a person gets older, their insurance rates are likely to go down. It should be no surprise that older people statistically get into accidents less, as they’ve had more experience behind the wheel and are less prone to rookie mistakes.

Driving Record

Perhaps the biggest factor on your rate is your driving record. One of the reasons young drivers pay more is that they haven’t been driving enough to have a record, so the insurance provider doesn’t know what type of driver they’re going to be. Some people seem to get into accidents every year, or even more frequently, and these drivers are likely to continue getting in accidents at a high rate. Because they will end up costing the insurance company more money, they are charged more upfront. If, however, you drive for many years with little or no accidents, your insurance rates should shrink.

Value of Car

Another reason for differing rates could be the value of the vehicle you’re insuring. The newer and more expensive the car, the more expensive it will be to repair should you get into an accident. Also, if the car is totaled and needs to be replaced, the insurance company will be out a lot of money.

Education

There are a couple of ways that education can influence your insurance rates now. If you are or have a student driver, some companies will give you a discount, especially if you send them a transcript with impressive grades. Some companies also provide optional education courses that customers can go through in order to become safer drivers and lower their rates. So when you’re comparing auto insurance in Lansing, you will have an understanding of why insurance companies offer different rates to different customers.