Whether you’re a teen looking at buying your first car or an adult buying your fifth, auto insurance rates can be a bit of a mystery. It’s difficult to gauge what a driver’s premium will be without some insight into how insurance companies make their decisions. Thankfully, Mutual Underwriters in Honolulu, Waipahu, Maui, Kona, and Hilo, HI, has some insight. The company has been providing locals with insurance since 1958, and they often explain to their customers exactly what they’re taking into account when they calculate rates.
5 Factors Impacting Your Auto Insurance Rates
1. Driver Age
People who just got their permit or license pay more for auto insurance because they don’t have much experience and are more likely to get in an accident. Some policies can drop up to 25% when the driver turns 25, so long as their driving record is clean.
2. The Car
Auto insurance companies keep extensive data on different vehicles and what accidents they are involved in. This allows them to adjust their rates per vehicle based on previous studies of safety tests, accident and theft rates, the cost of repairs, and the vehicle purchase price. While some cars may have better safety features, those extras can be costly to repair in the event of an accident, which might raise your auto insurance rates.
3. The Driver’s Address
In some states, insurance companies offer base rates depending on the address of the driver. This location affects the chances of your vehicle being stolen, vandalized, or damaged due to the weather.
4. Driving Record
Drivers who have records of moving violations, like speeding or DUIs, or who have been in accidents pay higher auto insurance premiums.This is because insurance companies are taking a bigger risk by offering them policies.
5. Credit History
It is believed individuals with better credit histories are less likely to commit insurance claims, file inflated claims, or get in car accidents. A driver’s credit history can affect what rate they receive as well as how much of a premium they will need to pay. Not all states follow this rule, so check yours before looking into auto insurance.
Now that you know a bit about how auto insurance companies adjust their rates, it’s time to start shopping around. If you live in Hawaii, call Mutual Underwriters at (808) 532-2888, or visit the website to learn about ways to lower your auto insurance.