You May Be Overlooking These 10 Factors That Affect Your Auto Insurance Costs

By Patrick Banks

Posted 1 year agoOTHER

Auto insurance is more complicated than you might imagine. Your premium costs — the monthly or annual payments you’re required to make to maintain adequate, legally required coverage — depend on a variety of factors.
You May Be Overlooking These 10 Factors That Affect Your Auto Insurance Costs

Not all of these factors relate directly to your driving habits or record. Some, like your credit score, have nothing to do with driving at all (although your credit score can be affected by auto-related events, like defaulting on a car loan). 

That being said, it’s crucial that you understand how each of these factors may affect your personal budget. Keeping each in check could significantly reduce your auto insurance costs and leave more money in your wallet for life’s finer things.

1. Where You Live

If you live in one of the most expensive states for auto insurance, your auto insurance premiums could be 50% or 100% greater than the national average — for no reason other than an accident of geography. Michigan and Louisiana have long been the two most expensive states for auto insurance; Florida is usually high on the list too.

2. How You Shop for Auto Insurance

When you work with a reputable partner like top insurance broker InsureOne, you’re more likely to find a reasonably priced auto insurance policy that meets your needs without needlessly straining your budget. 

3. Your Policy’s Deductibles

The higher your policy’s deductibles, the lower its overall premiums. If you never have to file a claim, you’ll make out much better when you keep your deductibles high. On the other hand, a high deductible could really hit you in the wallet after an accident.

4. Your Moving Violation Record

Even one minor speeding ticket can significantly increase your auto insurance premiums. If you have one or more moving violations on your record within the past five years, you’re likely to pay more than drivers with squeaky-clean records. Avoid traffic tickets and watch your premiums decline over time.

5. Your History of Serious Driving Offenses

Serious driving offenses like driving under the influence and reckless driving raise auto insurance premiums to a greater extent than everyday moving violations. It’s extremely important for your personal finances, not to mention your physical safety and the safety of those around you, to drive responsibly at all times.

6. Your Auto Accident History

You’ve probably been in an auto accident that’s not your fault. Unfortunately, that may not be enough to prevent your auto insurance premiums from increasing in the wake of a claim. If you live in a state with no-fault insurance laws, any accident could raise your premiums, regardless of who’s at fault.

7. Your Credit Score

For better or worse, your consumer credit score is a factor in your auto insurance premiums. Drivers with good credit usually pay less for insurance than drivers with significant blemishes on their credit records. Pay your bills on time and avoid overextending yourself; over time, your credit score may improve.

8. Whether You Bundle Your Auto Insurance With Other Types of Coverage

An insurance bundle is an effective premium-reduction strategy. Depending on the insurer and the size of your bundle, you could reduce your auto insurance premiums by 20% or more when you bundle home, auto, life, and other types of coverage.

9. Your Driving Habits

Obey the speed limit, don’t brake too fast, avoid accelerating quickly from a stopped position. These aren’t just commonsense driving safety measures — they can also reduce your insurance premiums when you enroll in a safe driving discount program.

10. Your Eligibility for Money-Saving Insurance Discounts

You and your vehicle qualify for a bevy of insurance discounts, and you might not even know it. Common discounts include safe driving (discussed above), good student, anti-theft device, anti-lock braking, overnight garaging, and more. Ask your insurance broker how to capitalize on these money-saving opportunities.

Find the Right Auto Insurance Coverage for Your Driving Needs

As you can see, your auto insurance premiums depend on a variety of factors, some of which aren’t directly related to what you do behind the wheel. Whether this is fair or not is a separate question from the proven steps you can take to minimize your auto insurance premiums without compromising on coverage.

Don’t laugh. It’s possible to obtain high-quality auto insurance coverage without busting your budget. But you’ll need to work with an experienced, reputable insurance broker and be willing to educate yourself about the factors that affect auto insurance premiums.

It’s worth the effort. After all, you don’t willingly pay more than advertised for groceries and basic household goods. Why should you pay more than necessary for auto insurance, which is every bit as essential?

About the author Patrick Banks

Patrick is a Berlin-based dating advisor, motivational speaker, a huge fitness and vegan diet enthusiast and the main editor at Wingman Magazine, specialised in men's health. His ultimate goal is to share with men around the world his passion for self-development and to help them to become the greatest version of themselves. He believes a healthy body and successful social interactions are two main keys to happiness.