The top things that affect your insurance premium is, your driving record, your age, your gender, Length of time licensed, the type of vehicle(s) you drive, coverage and deductibles you chose. One of the big factors of your premium will also come from your INSURANCE CREDIT SCORE. Yes, that’s right, your credit history will affect the premium you pay for your car insurance.
People often get put off when told that due to their credit score, the insurance premium will be higher. Some of the reasoning behind Credit Scoring is that the majority of FRAUDULENT claims are put in from people with not a very good Credit Score. Is that to say that everyone that has bad credit is a FRAUD risk? No. However, when you are talking about insurance the actuaries go by the law of large numbers. Therefore, the best advice that I can give if you are paying a very large premium for your car insurance, is to work on achieving a better score on your credit report. The higher the number the better the score.
Other factors to consider is your driving record. Do you have accidents? Do you have tickets? (Always refer to your insurance professional, or other professionals on how to handle these.) I often inform my insureds that if they receive a speeding ticket to reach out to the court or police dept. that issued the ticket, attorney etc. on the best way to handle it. Most occasions if you have not had many tickets, if you plead not guilty and go to court, the prosecutor may drop your speed down to a parking violation in return for an offer for you to take a certified driving course and pay a fine. This may then become a non-chargeable violation and will not affect your insurance premium.
Accidents? The best way to handle an insurance claim is to DISCUSS with your AGENT prior to calling the claims department, UNLESS there are any injuries. In the event of a vehicle accident with injuries call the police and give them all the vital information regarding the accident. If your car was hit while parked, or if you were involved in a very small fender bender, like hitting a stationary object, you are often better to get an estimate of damages prior to processing a claim. If the estimate is not significantly higher than your deductible, then this may be a claim to just “pay out of pocket” or just keep the dent. These are things to discuss with your insurance agent as they can look up your record and give you some advice.
Often, I find that people have put in multiple small claims due to not being informed as to how this is going to affect their insurance premiums going forward. Insurance companies look at INCIDENT history as well as who was at fault. Make no mistake, if you were to put in 4 hit while parked claims in a few years, you may be “dropped” by your insurance company just based on incidents, even though technically you were NOT at fault. In fact, the reasoning for this is either you have very bad luck, or you keep parking in the same spot, which is causing you to be hit. Regardless of what this may be, if the insurance company pays out, they are going to look at it and determine if you are a good risk or not. Keep in mind that the HIGHER your deductible the lower the premium.
