What Is a Car Insurance Premium?
“What is an auto insurance premium?” We hear this question all the time, and the answer is simple. Your car insurance premium is how much you pay for your vehicle’s coverage. It’s based on your driving record, vehicle and the coverage you choose. Depending on the type of
car insurance you get, you may need to pay monthly, every 6 months or annually for coverage.
- Type of car
- Coverages
- Vehicle type
What Affects a Car Insurance Price?
Every insurance company calculates their car insurance prices differently. Factors that typically influence your rates include your:
- Driver history
- Vehicle type
- Average miles driven in a year
- Coverage limits
- Deductible amounts
- Discounts
Personal Details
When you request car insurance quotes, your insurance company will likely ask you for your:
- ZIP codes
- Age
- Marital status
- Car’s year, make and model
- Vehicle use
- Licensed drivers
- Claims and insurance history
Throughout the process, it’s important to remember that the
average cost of car insurance differs from person to person. For instance, 16-year-old male drivers pay a different premium than 40 year old female drivers.
Driving Habits & Record
Your current driving habits and your history of claims can impact your insurance premiums. So, if you’ve had a lot of claims in the past, you’ll likely pay more for insurance. If you have recent tickets, your premium may be higher.
Type of Car You Drive
The type of car you drive can influence how much you pay for insurance. For instance, cars with more safety features can cost less to insure. You’ll also have to pay more if the type of car you drive is commonly stolen or is expensive to repair.
Types of Coverage, Limits & Deductibles
The more
types of car insurance coverage you choose, the more your premiums will be. Most states require minimum liability coverage amounts for bodily injury and property damages. You may also need uninsured or underinsured motorist coverage. But in order to get full protection on the road, you’ll likely want to add more coverages, like:
Car Insurance Discounts
Average Auto Insurance Premium
According to the Insurance Information Institute (III), the national average car insurance rate in 2017 was $1004.
2 To find out how much your premium will be, contact a Hartford representative at
888-413-8970 today.
What Can Affect Car Insurance Premiums During Renewal?
Auto insurance policies typically last six months or a year. Once they’re up, car insurance companies contact their customers for renewal. At this time, they’ll review your coverages, limits and policies. After this, your
car insurance may go down or it might increase.
Many factors can influence your premium. One is having multiple
car insurance claims filed during your policy period. Any traffic violations, like speeding during your policy period, can also impact your premium.
If you’re trying to reduce your premium, it’s easy to do so by getting discounts and improving your credit score.
Understanding Car Insurance Prices: Quote vs. Premium
Your car insurance premium is the amount you’ll pay your insurance company for coverage regularly, whether it’s every six months or annually. An insurance quote is just an estimate of what you’ll pay for your coverages.
When you shop for a policy, it’s a good idea to get multiple quotes from auto insurance companies so you can compare them. These quotes are not final and may increase or decrease as you continue going through the buying process.
Get a Quote for Car Insurance Today
Last Updated: September 21, 2023
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