Auto insurance saves you from financial responsibility in case of an accident that damages your vehicle, saving you time, stress, and money. If you’re on the market for this type of insurance and have received different quotes, you may be wondering what’s taken into account when calculating the cost of your coverage. To help you understand how providers reach their rate, here is a guide to some of the factors they tend to consider and why.

What Influences the Cost of Auto Insurance Coverage?

1. Driving Record 

The greatest influence in your coverage rate is your driving record, since insurers view motorists’ past actions as an indication of future driving habits. If you’ve been involved in multiple accidents or collected many traffic citations, your rate will be higher than someone with a clean record.

2. Location 

Those who live in urban areas typically pay more for auto insurance than drivers in rural communities since higher population densities raise the risk of theft, vandalism, and accidents. Insurers will also consider your specific neighborhood and its crime rate when giving your rate.

3. Type of Vehicle 

Vehicles that score high on safety and come with features such as airbags, shatter-resistant glass, and anti-lock brakes usually cost less to insure. In contrast, cars that can reach high speeds, are at a greater risk of theft, or are expensive to repair, such as imports and sports cars, increase your premium significantly.

4. Credit Score 

Many insurance companies use credit scores to predict how likely a driver is to file a claim. Providers also tend to believe that those with better credit will be more responsible behind the wheel, which will decrease their coverage costs. 

If you’re looking for more cost-effective auto insurance coverage, contact Southern Insurance in the tri-state area. An independent agency for 17 years, who represent over 70 reputable insurance carriers and can help you take care of all your insurance needs, from home, auto, and business insurance. Learn more about Southern Insurance’s services online, or call (423) 296-0626 to request a quote.