Your family status and the car model affect the insurance premium of your car
Your marital status affects your car insurance premium as evident from some numbers. The average car insurance rate varies between $649 and $662 for half-yearly premium for widowed, divorced and single individuals, whereas for married couples it goes down to $625, resulting in saving 6%. It happens because the insurance industry considers marriage as a major milestone when calculating the premium on cars. The companies follow an auto policy that looks upon married couples as stable customers and ready to reward them with a low premium.
More saving for homeowners
Married couples can expect some additional savings if they are homeowners and not renters. Homeowners file lesser claims than renters – this is the perception of car insurance companies who are ready to lower the rates for homeowners who have to pay $646 as average premium for 6 months as compared to $662 paid by renters, as found in a study. Another way to push down auto premium further is to bundle your auto policies and home insurance by taking it from the same company that can save about 10%. For multiple policies with the same company, homeowners must pay $591 based on 6-month average whereas renters must pay $625.
Do insurance companies reward mothers?
Car insurance companies adopt new marketing strategies and offer discounts on special grounds like marriage and owning a house. There are expectations in some quarters that they might also offer discounts to new mothers every time a child is born. However, the birth of a child does not help to lower car insurance rates. There is a long list of factors that the carriers consider for calculating the premium rate. It includes many things like age, gender, occupation, marital status, driving record, driving history, education, geographical location, the type of car and many more factors but not new mothers. Yet, intelligent couples can use the event of childbirth more creatively to lower the premium.
The car model can lower the premium
As the birth of a child is a happy addition to the family, it could make the couple think about switching over to a new car that is more spacious and more comfortable for the new family size. When buying the new car, they can take advantage of the fact that car premium depends on the type of car. Choose a car that is not only more spacious but also has advanced safety features, a point well taken by the insurance companies that would not mind to charge a lower premium. The trend can continue if the couple wants to expand their family in the coming years and repeat the same procedure of upgrading the car and lowering the premium.
Why car model affects the premium?
The auto insurance cost constitutes a large chunk of the cost of acquiring a vehicle, and you must keep this in mind when you are shopping for a vehicle. Styling and comfort, features and fuel economy, are always on the top of the mind of car buyers. Ignoring how the selection can affect car insurance premium can present some rude shocks to car owners who must shell out a significant amount every year to enjoy the ride. High-end vehicles are bigger and expensive, the spare parts are very costly, and even repairing damages are quite expensive. Insurance companies calculate the higher payouts in the event of claims and accordingly charge a higher premium. One may argue that these cars have advanced safety features which is very true, but that does not reduce the chances of accidents that depend on many extraneous factors.
Sports cars attract higher premium
Risk assessment is at the root of calculating the premium for cars and carriers do a complete analysis to understand the level of risk. By looking at the model and type of car. For example, if you buy a sports car, the car insurance companies would perceive it as high risk because they would consider that you have purchased the car. After all, you love speed and that you would drive at much higher speeds than the general driving population that increases the chances of an accident. Consequently, they would charge a much higher premium than average, and it is the price that you must pay for pursuing your passion and dreams.
Higher premium for theft-prone cars
There are some models of cars that are soft targets for car thieves, and if your car belongs to that category, you cannot avoid paying a higher premium. Typically, a third of the premium collected by the companies goes towards payment for auto theft claims, and it seems quite reasonable on their part to protect their interests by charging a higher premium to take care of the vulnerability to the theft of the car model.
Although the reasons why thieves target certain car models are not always clear, the common causes are desirability of that model and the demand for the parts.
Thank you,
Glenda, Charlie and David Cates
