While your top priority when shopping for car insurance should be finding adequate coverage, it’s still important to get the best deal possible. This requires a basic understanding of how insurance companies calculate rates. According to the professionals at Charles Adams Insurance Agency in Ashland, KY, policy premiums are based off a variety of factors that help providers assess how much of a risk a driver is.

Location

Where you live not only affects the price of a home insurance but how much you pay to insure a car as well. This is because agents consider the crime rates and population of an area when evaluating the risk. If you reside in a community that has a high theft and vandalism or a lot of traffic, you may pay more than someone who lives in a rural area with low crime rates.  

Vehicle 

Not all cars are created equal, especially in the eyes of insurance companies. The more safety features a vehicle has, the better the coverage premium is likely to be. Also, higher-end models and those with rare parts are generally more expensive to insure due to increased risk of theft and pricier repairs and replacement materials. 

Driving Habits 

One of the most significant factors to impact car insurance premiums is driving habits. If your driving record is riddled with moving violations and at-fault accidents, there is potential for the rates to rise considerably. Typically, providers review the last three years of a driver’s history to gauge how probable it is they will file a claim. 

Personal Information 

Though there’s nothing you can do to change your demographics, to cut down on car insurance costs, it’s worth knowing insurers do take age, gender, and marital status into account when deciding the premium. They look at statistics to see who has the highest risk of being in an accident and use their findings to assign rates accordingly. Additionally, they consider credit scores and homeownership to help establish financial responsibility.

Coverage Selections

What you pay for car insurance also depends on the type of coverage and what you set the deductible at. The more coverage you add to a policy, the higher you can expect the cost to be. Choosing a low deductible will mean you pay a higher premium and vice versa. Another factor to keep in mind is that many insurers will give you a better rate if you purchase multiple policies from them. 

Knowing how car insurance rates are determined will give you the opportunity to make adjustments wherever possible to obtain a lower premium. However, the best way to maximize your savings is by working with an experienced insurance agent. The team at Charles Adams Insurance Agency will help you find all the discounts you’re eligible to receive without compromising on coverage quality. Contact them at (606) 325-9709 to request a quote, or visit their website to learn more about the different types of coverage.