You may have noticed that auto insurance rates vary widely from person to person. If so, you probably wonder why you pay considerably less than some policyholders but much more than others. Insurers base their rates upon a number of factors — here are some of the main ones that influence your premium. 

What Factors Influence Your Auto Insurance Rates?

1. Your Vehicle

The make, model, and year of your car are perhaps the most important determining factors in your rate. The newer the car, the more it’s generally worth, and the more it will cost to repair or replace if it’s damaged. This means the insurer undertakes a greater risk when granting you coverage, and thus charges a higher premium. The same is true of the model. Expensive sports and luxury cars cost more to insure than basic compact models.

2. Your Personal Information

Your age, sex, and marital status all contribute to your auto insurance premium. It may seem discriminatory, but insurers have found that men, younger drivers, and singles are all more likely to file a claim than are women, married people, and more experienced drivers. The riskier you are in terms of personal characteristics, the more you'll pay for auto insurance.

3. Your Driving Record

If you have a history of moving violations and accidents, your rates will be higher than those of someone with a clean driving record. Dings on your license usually go away after three years, so if you can avoid trouble for that long, you should notice a decrease in your rates.

4. Your Credit Rating

Insurers use portions of your credit report to determine rates, as well. Even if all else is equal, you'll pay more for coverage if you have a history of late payments, bankruptcy, and charge-offs than someone who has an A+ credit rating.

5. The Number of Policies You Have with Your Insurer

Most insurance companies offer discounts to policyholders who "bundle" their coverage with the same company. Thus, if you buy home, auto, and life insurance with an insurer, you'll usually pay less for the bundle than you would if you bought them separately.

To see if you can lower your auto insurance rates — or at least get better coverage for the same amount — contact A Better Choice Insurance Agency in Concord, NC. They've been helping businesses and individuals throughout Cabarrus County design the right policies for more than 25 years. They also specialize in home, RV, motorcycle, and life insurance, so you can ask about bundling coverage. Visit their website to view location details and office hours, or call (704) 782-2073 to request a free insurance quote today.