Rancho Cucamonga, Ca – (WiredPRNews.com) Although it’s likely not the first factor taken into consideration when purchasing a new car, the type of vehicle that a consumer finally decides on buying could drastically affect the price that he or she pays for auto insurance. In a new FAQ, the writers at OnlineAutoInsurance.com discuss why this is the case.
When insurers receive an application for coverage from drivers, they decide how much car insurance will cost by looking at the risk factors posed by a particular motorist. If they have minimal driving experience or have racked up multiple tickets or accidents, rates may be adjusted upward to compensate for the increased likelihood that a claim will occur. On the other hand, if they have a long history of safe driving, prices will likely remain low. But insurers take into account much more than driving history when calculating premiums. Most states, for instance, allow auto coverage providers to adjust rates based on such unexpectedly predictive factors as credit history.
Much in the same way that insurers assess a driver profile in order to anticipate the frequency and severity of possible claims, coverage providers also assess the overall history of the type of auto that is to be insured. As most state insurance departments advise residents, the very general rule is that the price of insuring a vehicle goes up along with the overall price of the vehicle. But there are more specific factors to look at than just price.
The two things carriers basically want to know are the likelihood that a policyholder will file a claim along and the likely price of any claim. To gain insight into the second of these two variables, consumers can look at a report released annually by the Highway Loss Data Institute that ranks private-passenger vehicles in relation to the average insurance loss. The ranking is distributed through the National Highway Traffic Safety Administration, and the most recent report can be found on the administration’s website. Although premiums may not correlate precisely with the data found in these rankings — insurers tend to base risk-assessments off of their own internal data — they can be a useful guide.
Readers can go to http://www.onlineautoinsurance.com/ to access the full FAQ and get all the details on which types of cars have higher or lower coverage costs and why this may be the case.
Online Auto Insurance, LLC
8667 Haven Ave Ste 100
Rancho Cucamonga, Ca 91730
Phone: (909) 912-1855