If you live in The United States and you own a car, you need to buy an insurance policy.
Many people get confused, however, at how insurance companies determine your rate.
Here are a few areas that factor into the auto insurance rating system.
The model you drive.
The model you drive is a very important part of the auto insurance rating system.
Insurance companies want to insure safe vehicles.
The safer your vehicle is the lower your rate will be.
If you drive a car that is meant to drive slow, like a mini van, you will have a lower rate.
Models that are meant to be driven fast, like convertibles and sports cars, will have a higher rate.
Where you insure your car.
The location is another important factor in the auto insurance rating system.
This is because some states have a better driving record than other states.
Louisiana, for instance, has a high rate of uninsured drivers.
This raises the insurance rate for everyone else.
Also, if you live in a state that has a lot of accidents, or many DUI arrests, you will have to pay a higher price.
Your driving record.
Almost all insurance companies will check your driving record before they issue out a policy.
This is because almost all companies award safe driving.
If you do not have an accident, or a traffic ticket on your record you will get a lower rate.
Most companies will search three years back in your history for traffic violations.
If you do have an accident on your record, you can lower the price by driving safe.
Another factor that goes into your insurance price, is the number of times that you report a claim.
If you constantly report claims, your rate will go up.