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What Factors Affect Auto Insurance Rates?

When it comes to auto insurance, not all policies or providers carry the same rates. In fact, the amount you’ll pay each month is determined by a number of factors — from your annual mileage to your car make and model and even your personal demographics! Fortunately, when you understand what influences auto premium prices, you’ll know how to find the best insurance policy at an affordable rate. 

Ready to find affordable car insurance that you can rely on? We’re here to help you do just that. Stay with us as we cover the top rating factors most often used by auto insurers—and how you can maximize your savings each month.

How Car Insurance Companies Decide Your Rate

While not all companies use the exact same guidelines, here’s a list of what commonly determines the bottom line on your auto insurance policy.

Your zip code matters, too, because car insurance rates are also determined based on the factors associated with each area. For example, city drivers will often pay higher auto insurance rates than those in smaller towns or rural areas, since urban areas have higher rates of accidents, auto theft, and vandalism. Zip codes that are vulnerable to floods, earthquakes, and wildfires also result in higher rates for drivers. 

The cost of your car is also a major factor in determining how much you’ll pay for a premium. If your vehicle costs more to replace, the insurance company will charge you more each month to cover these potential costs (via collision and comprehensive coverage).

Finally, vehicles that are statistically more likely to be stolen— such as a Ford F-series pickup truck or Honda Accord — also raises your rates, since they pose a higher risk. 

On the other hand, if you have a clean driving record, you could pay up to 40% less than high-risk drivers, thanks to safe-driver discounts. 

Tips For Lowering Your Car Insurance Rates

Ready for the good news? If you’re struggling to afford your coverage, there are plenty of ways to lower your coverage rate, including:

See How Much You Can Save on Auto Insurance

We believe that everyone deserves the protection of a comprehensive auto insurance policy—and it shouldn’t be a drain on your wallet! That’s why we’re proud to offer some of the best coverage rates in the industry. Thanks to our fast and get free online insurance quotes, you can choose a plan and get your coverage in just minutes. Get your free quote today and 

enjoy the peace of mind that you and your family are protected on the road. 

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Frequently Asked Questions

What are the Major Factors that Determine Car Insurance Rates?

Though there are multiple factors that will go into calculating your car insurance rates as discussed here. There are 3 major factors that you can bet will determine your overall auto insurance rates:

1. State law and what amount of auto coverage you’ll need legally.
2. Your car’s make and model.
3. Age of the drivers on the policy.