Factor That Calculated The Car Insurance

What will effect the cost of your car insurance?

Put simply, the price you pay is determined by the type of cover you need (e.g. fully comprehensive cover versus third party) and how often and how much car insurers expect you to claim on your policy.

To work out the likelihood of you making a claim insurers will look at details about you and your car, and these details can greatly affect the amount you will need to pay for car insurance. Below are the key factors that car insurers use to determine the cost of your insurance premium:

About your car:

Car Value – The more expensive your car is the more expensive it will be to replace (and typically, the more expensive it will be to fix too). So, the higher the cost of the car, the more you can expect to pay for your insurance.

Car Power – The faster and more powerful the car, the more likely it is you will be involved in accident. This will increase the likelihood of you both making a claim and also the size of that claim, so higher power cars typically have higher cost premiums.

Car Desirability – The more desirable your car the more likely it is to get stolen. Replacing a stolen car is a huge cost for the insurer and so this risk will be reflected in a higher premium. Some classic cars for example can incur larger than normal premiums.

About you:

Your Age – Younger drivers statistically have a higher risk of having an car accident and so will pay the most for insurance (the 17 – 25 age group typically has the highest premiums)

Your Job – Some professions are statistically seen as including higher risk individuals (e.g. students, journalists, actors etc.) and so will be used as a factor in deciding the cost of your insurance.

Where You Live – As a rule of thumb, built up urban areas are likely to have more traffic on the road (increasing the likelihood of an accident) and more car theft and so living in such areas will increase the amount you will need to pay for insurance.

Car usage and storage:

Your Claim History – Insurers believe that if you have claimed in the past you are more likely to claim again. Most insurers will offer a no claims bonus which can significantly reduce the cost of your insurance.

Previous Penalty Points – Insurers take this as a sure sign that you are a high risk driver and will reflect this in charging you more for insurance than those with a clean license.

Car Storage – Keeping your car in a garage as opposed to on the street can reduce the chance of theft and therefore reduce the amount you will be expected to pay for insurance. This can be particularly important if you live in urban areas where insurers will charge more due to the perceived increase in the risk of car theft.

Mileage – The more you drive the more you are likely to be involved in an accident so higher mileage policies will typically cost more.

Type of cover:
Third Party Vs Third Party Fire and Theft Vs Fully Comprehensive – The level of cover you require is one of the more obvious factors determining how much your insurance is going to cost you.

Voluntary Excess – If you are willing to accept some initial costs of your future claims upfront this will both reduce the amount of claims you are likely to make and also the cost of those claims to the insurer. Insurers will therefore offer you lower cost premiums.

Unfortunately, some of these things you can’t change (like your age), but other things like how you store your car, how carefully you drive and the type of car you buy can all have a significant positive impact on reducing the cost of your insurance.

 

How To Find Great Car Insurance

When it comes to getting your car insured, you will hear people talking about rates that are over a hundred dollars a month. If you are like most, that is extremely high, almost to the point of unaffordable. It does not have to be this way. What many big name insurance companies do not tell you is the fact there are many ways to get cheaper car insurance. Searching on the internet for cheap auto insurance quotes is an indirect way to find affordable and cheaper auto insurance companies.

When you have a teenage child, purchasing a car (new or used) will entail getting that vehicle insured. Many parents require the teen to pay for the additional insurance, as it can cause an additional burden on the family finances. Some families will even choose to put the child on a separate insurance so their own rates will not go up. There are, however, many ways to offset the additional cost making it so keeping your family safe will not break the bank.

Discounts

One of the best ways to lower the car insurance bill is by accumulating discounts. Families that add the child and car onto their plan will discover they are eligible for a multi-car discount. If the child is a good driver, with no traffic infractions, then that will further drive down the rate of the car insurance premiums. Finally, as an additional incentive to keep grades above a C, students will be eligible for an additional good student discount on many insurance plans. If your agent does not tell you about it, ask them. If they do not offer it, consider a different company.

Car Details

Unbelievably, the vehicle you purchase will determine the premiums charged. While this no longer includes the color, it does include the make and model. What is taken into consideration with insurance premiums is the price of the car, the style of the vehicle (sports cars), and if the vehicle is a model that is commonly stolen.

You can combat those insurance premium hikes, however. First, you can purchase a used car. The older cars will have lower premiums, just as your insurance premiums drop as your car ages. Secondly, you can install anti-theft devices in your vehicle. Devices such as On Star will help recover your vehicle if it is stolen, and insurance companies are less likely to be out money. If you park the car in a garage, then you will want to make sure that you tell the insurance company that. Vehicles that are protected from the elements and in a locked location are less likely to be damaged or stolen.

Finally, with the addition of safety devices on the car, you will see insurance rates drop. Air bags and seat belts should all work, and ones that automatically lock when you close the door are ideal. This requires the driver to be buckled in, which will help them remain safer in the event of an accident. Studies have shown that fewer people die as the result of an automobile accident when they are properly restrained and the air bags deploy.

Classes

A teenager can lower their insurance premiums by simply taking a driver’s education course through a licensed school and complete a defensive driving course. You will want to make sure you have documentation showing that the child has completed the courses successfully, in order to have little problem receiving the discounts. Again, if your current insurance company does not offer benefits for taking courses, you will want to reconsider whom your car insurance is through.

Teens that are learning how to drive will make mistakes. It is just like anything that you learn. These mistakes, however, can be costly when it comes to vehicle insurance. Restricting the amount the teen drives until they are more experienced is a way to help them reduce the number of accidents. In addition, the fewer miles put on the vehicle will cause the insurance rate to be lower.

What you have on your car insurance will reflect how much you pay. If you wish to lower your car insurance premium, be willing to pay a little more if there is an accident. If the vehicle is too old to be worth anything in the event of a wreck, remove the collision and comprehensive coverage. Make sure that you are aware of your vehicle’s worth prior to making these changes, as some cars may be worth more than you think.

 

Things You Should Notice Before Apply Car Insurance

What to watch out for while choosing car insurance?

The most important criteria include the five “C”s. Here’s a brief description of each:

Claim settlement policy – The true test of an insurance company is at the time of an actual insurance claim. This is possible to check by looking at the company’s past records of claim resolution. Now is the time to check if the existing insurance can be transferred to another insurance company without loss of benefits already paid for.

Coverage – What is the right coverage for you? Usually, car insurance policies cover third party liability and own damage. According to the Motor Vehicles Act, it is mandatory to opt for third party liability insurance cover while own damage is optional. Opting for both is the standard procedure since they cover any damage due to accidents and loss from third party mishaps. Most insurance companies offer “add-ons” with the basic policy.

Customer service – Thanks to technology, insurance policies are now issued instantly. Besides this, other issues such as changes in policy or cancellations are processed quickly. In the event of a claim, cashless settlement is also available so that post-repair delivery is quick without incurring bills at the workshop. It is therefore important to check the insurance company’s network for this facility. The bigger the network, the better the claimant’s options.

Communication access – The insurance company’s contact information must be easily accessible. If there is a problem the insured individual must know whom to get in touch with and the procedure to follow.

Cost – Last but not least, is the price or premium. Car insurance premium is based on “insured declared value” or IDV and the rate multiplier and depends on the car model, the age of the car, daily mileage and the terrain of the location. It is important to declare the right IDV and select a policy that offers the maximum IDV even if you have to incur a slightly higher premium.

Besides the above, the following are the benefits to look for:

No claim bonus – if no claim has been filed during the insurance period, a no-claim discount is offered on risk cover against own damage at the time of policy renewal. For each consecutive claim-free year, the discount increases progressively. The point to note is that the no claim bonus eligibility holds good even in the event of a new vehicle purchase or existing insurance renewal before the due date from a different insurance provider.

Opting for deductible – Drivers with a good record can opt for “voluntary excess” or deductible to lower their premium payments, in addition to the compulsory excess. In the case of a compulsory excess, the insured is liable to pay a specific amount if a claim is filed.

Premium based on car type – If your car has extra security features such as anti-theft alarms the chances of theft is lower and insurance can come at a lower premium.

Timely insurance renewal – If car insurance is not renewed before the expiry date the renewal premium can result in loss of coverage especially if there is an accident and also mean no discount for the no-claim bonus.

Choice of Add-ons– Besides the basic car insurance coverage, insurance providers offer several optional add-ons. It is important to select the right ones and only pay for those. For example, if there is a medical expense cover or hospital cash cover, check to see if you have a medical insurance policy that already covers these.

To renew or not to renew – with the same insurance provider? When it is time to renew your car insurance, compare insurance providers to see what they are offering before making a decision. The car insurance industry is very competitive and for the same coverage, you can probably get a better price elsewhere.

Some final precautions to bear in mind are:

• Check that the insurance policy is genuine. Always buy your car insurance directly from the insurance company or from its authorized agent.

• Always get a premium payment receipt.

• When you receive your policy document, check the IDV, no claim bonus and deductible details to make sure it is what you opted for. Any discrepancies must be notified and rectified immediately.

• Make sure only you sign the proposal form and always read before signing

• Do not opt for monthly payments as this is more expensive than annual payments

Remember that car insurance protects you and the occupants of your car on two counts: from accidental damage and from third party claims when you are responsible for the accident. Therefore, choose with care.

 

Things You Must Know About Auto Insurance

In order to be successful and proficient in all business it is very important that one familiarize himself with the terms of that particular field of interest or business he intend establishing. That is why knowing such terms will undoubtedly build you basic knowledge of your field of interest and eventually lead to you success in it.

Take a moment to review some of the terms associated with auto insurance and quotes before going into it as this will be very much helpful to you in your auto insurance policy success.

Adjuster

Also known as claim adjuster, this is an insurance company worker who is primarily responsible for investigating and settling all claims brought by claimants or insurance carriers resulting from a specific casualty. His responsibilities also include the evaluation and payment of the available or each claim to the policyholder.

Payment of claims is usually carried out only after all proceedings are verified. The claim may as well depend on the active insurance or coverage policy available of the item.

Accident

This is an unplanned, unforeseen or unintended event beyond the control of an insured, resulting in the loss of property e.g. car. The incurred loss can be compensated as a claim to the claimant by the carrier. The claim is based on what is observed and the actual cash value of the car or items involved.

Auto insurance companies try in the best of their abilities to supply sustainable, efficient, quality, and affordable policy coverage to their policyholders. They also aim at increasing the savings of their insured to meet specific needs e.g. building a big collection of policyholders.

Actuary

This is a specialist who computes premiums and risks of insurance. They are duly involved in the calculation of loss reserving, life expectancy and determining accident frequency. They serve as one of the key ingredients in an insurance company.

They also primarily help in making profit and financial stability of carriers (insurance companies) which they serve and involved in trends assessment as well as determining insurance prices.

These specialists also have a share in managing the carrier’s expenditure and the giving of claims to claimant on any needed basis. They help in ensuring that neither the carrier nor the insured suffer unnecessary loss.

Accident Frequency

This refers to the number of times there occur an accident. The frequency is calculated during the time of the insurance policy. The actuary normally computes the frequency of accidents to help determine possible losses.

It should be noted that the phrase may not actually mean the number of times or frequency an accident really does occur but the number of times an accident may occur due to the prediction of the actuary. Premiums can also be accurately and appropriately paid using this principle.

Appraisal

It is a formally written document of the estimation of the value of property of the insured. This is done as against any future casualty resulting in the loss of property.

When an appraisal is eventually damaged, it can be completed or replaced by the adjuster of the insurance company or sometimes a vehicle repair expert.

Additional Insured

It is an individual or organization who also has an auto insurance protection under the primary name insured auto policy. The protection may be extended form an auto leasing company to an individual who lends a car (s) to the primary insured.

In the event of an accident, damage or collision, the leasing person or company has protection against the specific casualty caused by the name insured.

Agent

He is a licensed insurance representative who sells insurance for an insurance company, negotiating and/or effecting insurance contracts. He serves as the middle man in providing quality insurance service to the policyholder.

Insurance agents usually carry out their work on a commission basis and in most cases they are non-exclusive or perhaps exclusive agents.

Agreed Price

This is the cost of repairs of damage to property as agreed upon by the adjuster and the corresponding representative of the body shop. Whenever an incurred loss occurs resulting in an accident to a car, the cost of repair agreed on will be used as a claim to the claimant.

The cost neither increase nor decrease as the price for any resulting damage for the car has already been agreed upon.

Agreed Value

This is the value of the vehicle agreed on by the insured and the insurer which will be paid out on the event of an accident or any other form of unforeseen damage.

It is a policy available mainly for custom vehicles or collectible which actual value remains the same over time without depreciating.

Assigned Risk Plan

Auto insurance plan managed by the state and mostly for individuals and car owners who cannot afford to obtain or qualify for auto insurance or conventional liability coverage due to financial insufficiency or poor insurance record.

They may be placed in residual market in order to get an insurance policy with carriers or insurer but for a higher price. Their coverage is through the state.