What is Driving Your Auto Insurance Rates?

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In a previous posting, NetQuote - Don't Compare Apples To Oranges, I reported on comparing auto insurance quotes, but I also touched on some of the factors that influence your car insurance rate.
We have received several emails from readers asking what they can do to save money on their premiums, without having to increase their deductible and/or reduce their coverage limits.
Following are some of the ways that auto insurers, including Allstate and 21st Century Insurance, evaluate what your risk is to the company.
Why Car Insurance Companies Care About Your Credit History If you have shopped for car insurance in the past, you know that the insurer requests to run a credit report in order to provide you with an accurate insurance quote and, ultimately, to approve you for a policy.
But you may be wondering why this is pertinent.
Your credit score (FICO) and payment history are important to the insurance company because they believe that folks with a better credit history are less likely to file a claim.
Furthermore, if you have a history of making payments on time you are more likely to pay your premiums on time too.
Safe Drivers Qualify For Discounted Auto Insurance Rates Many people are aware that having an accident can cause your car insurance rates to go up.
However, being accident free is not the only thing that will help reduce your rates.
It is also helpful to have no moving violations; moving violations include speeding tickets, running a stop sign/red light and driving while intoxicated.
The Car You Drive Will Affect Your Premium Although it is not likely that you can just run out and buy a new car, keep in mind with your next purchase that the type of vehicle you drive comes into play when companies calculate your insurance rates.
Insurance companies use these aspects to determine high risk vehicles: * Cars with a high replacement/repair cost (e.
g.
, sports cars) * Vehicles that have an elevated risk of theft * Safety record Refer to the 2009 Top Safety Picks from the Insurance Institute for Highway Safety for a listing of the safest vehicles.
How Location Impacts Your Car Insurance Rates With regard to location, insurance companies consider a few aspects.
Insurance premiums differ not only by state, but also by city and the neighborhood in which you live.
Location also includes how and where you keep your vehicle.
Insurers look more favorably on cars that are garage kept, versus those that are in outdoor parking lots.
How much control you have over some of the money saving options varies.
For instance, you may not be able to easily move or changes jobs (occupation is another risk factor).
You can, however, practice safe driving habits and strive to maintain good credit.
The more you know about the aspects that are important to insurers, the more you can do to qualify for a lower rate.
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