What factors
determine your car insurance rates?
You may be surprised!
You may be
surprised at the various factors that go into determining
your car insurance rates. Quite often consumers have
misconceptions. If you act upon false information you may be
costing yourself money!
Smaller towns may have higher
rates
True Story:
The
customer moved from the small Southeast Missouri town of
Dexter, MO to Cape Girardeau (the largest city in the
region)
Mr. Customer new that he was
supposed to notify his insurance company of his address
change. But he delayed the call, assuming that the move
would make his rates go up. He waited and waited,
finally 8 months later he informed the agent.
Result: His car insurance rate
decreased by $240 per year!
Why?
This customer did not realize that accident rates in the
small town were much higher per capita than the new larger
town. If he would have made the address change sooner,
he would have saved even more money!
Other Surprising
Factors that determine car insurance rates
Credit and bill payment
history Although not
used by every insurance company, most will use "insurance
scoring" to help determine future expectations. The
theory is: customers who pay their bills on time
are less likely to have claims.
Recommendation:
If you think (or know) that you have
bad credit, let your agent know during the quoting process.
Your agent can try to use companies that don't rely on this
factor.
Not at Fault Accidents
Of course an at fault accident will
increase your insurance premium, but so can a Not at Fault
accident. More and more companies are using this
factor (especially if you have more than 1) to predict
future claims.
Recommendation:
If the damages are small, you may
allow the at fault motorist to reimburse you personally and
therefore leave the insurance companies out of the equation.
Make sure to consult a trusted agent before taking
matters into your own hands. But this method could
save you and the other driver tons of money on your premium
over the next several years.
A $0 claim will raise your
rates If you suffer damages
that fall below your deductible and make a claim, you
will be the only one making any payments. Although the
insurance company doesn't actually pay for anything, by
filing the claim in the first place you will land yourself
on a CLUE report. This report will reveal your
accident and cause your rates to increase.
Recommendation:
If damages are small and don't involve
injury, consult a trusted agent before filing a claim.
It is possible that paying a little extra out of pocket now,
could save you big bucks down the road!
* All
insurance recommendations are based upon general
circumstances and should not be considered as advice.
Please consult a licensed insurance agent in all situations.
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