Car Insurance Pricing Factors

Car insurance isn’t something that many people enjoy paying but unfortunately it is a necessary evil that e all have to pay. So why not completely understand what factors into the money you have to pay each month so you can get yourself the best deal possible?

The following article will examine the items that affect what you end up paying for car insurance and hopefully will give you some insight into saving some money on your car insurance.

Factors that affect your car insurance rate:

Previous Driving Record: One of the more obvious factors, car insurance companies will examine your prior driving record when they are in the process of providing you a quote. If you have received many tickets in the past few years or have had your license suspended you can expect a high monthly payment. If you happen to have had a DUI in the past you also should expect to have a higher then normal rate.

This also can benefit you as well. If you driving record is clean and you have not gotten any tickets or been in any accidents recently you can expect to benefit from this and receive a low quote.

Education: Auto insurance companies believes education is a factor that plays into your responsibility when it comes to driving. Statistic show that someone with a masters degree is a more responsible driver then someone who never finished high school.

Home Address: Where you live also plays a large factor in what your car insurance rate is. Whether you live in a city or state with strict traffic laws and high rates of accidents can play a large role. Rates for people in New Jersey will differ drastically from those who live in Montana.

The Car You Drive: Insurance rates differ depending on the make and model you drive. The insurance for a Jaguar is going to be significantly higher then a Honda Civic. This information should play a role when you are looking to purchase or lease a car.

The one thing you want to make sure to understand if different auto insurance companies each weight these factors differently. It is important when looking to get car insurance you get quotes from multiple companies. Just because Progressive gives you a high monthly rate does not mean Geico will. So take the time to shop around when it comes to auto insurance and make sure to compare car insurance quotes against each other. In the end it will be worth taking the time to save yourself some money!

Understanding State Minimum Insurance

Car insurance is required by law. It’s a law that has been in place for many years across the United States. But did you know that car insurance is actually regulated at the state level?

Each state across the US passes laws on the level of car insurance that is needed for their citizens. Many things go into figuring out how much car insurance is needed for each person.

So Do Most People Pay The State Minimum?

This really varies per state. Many of the most popular insurance companies do not provide state minimum coverage. They offer a higher rate of coverage for an increase in price. If you need more coverage then the state minimum it makes sense to get higher coverage. If you do get a higher rate of coverage it will cover a large amount of your accident. This way you will have to pay less out of pocket if something were to happen.

But state minimum coverage also has it advantages and the major advantage is that it is cheap! When they say ‘state minimum’ it is actually the lowest amount you are legally allowed to pay by law in that specific state. As mentioned above each state in the United States has a different state minimum. And you can actually check out what the state minimum for your state by getting a quote on our website. We’ll help you get quotes from multiple companies and you only have to fill out our lead form once!

How Do You Decide If You Should Only Pay The State Minimum?

This decision should be made by figuring out how much coverage you need and how much coverage you can afford. If you are having trouble paying your bills you should probably get the minimum. If you are a great driver and do not have a long commute or drive frequently then it may also be a good option.

But if you drive a nice or expensive car and have a long commute you may want a more expensive car insurance that offers better coverage. The important thing to remember is that you must have car insurance. State minimums are often low and it’s illegal to drive without car insurance.

What Is Tort Insurance

When selecting car insurance it can be very confusing. There is liability insurance, tort insurance and a whole bunch of other confusing terms that you do not use in real life. So what do you need? What type of coverage do you want and how much is it?

Let’s look specifically at what tort insurance is.

When you are in an accident Tort insurance is what enables you to sue a negligent driver for pain and suffering.You are still able to sue for medical expenses if you have selected limited tort.The main advantage of limited tort is the fact that you get a reduced cost in your monthly premium while still being covered for potential medial bills from a major accident.

Why would full tort be a better option?

Full tort allows you to sue for things like pain and suffering. If you are in a major accident have full tort would be very beneficial. You may have a significant amount of pain and suffering after an accident and not be able to return to work. If you are able to secure extra money though legal measures you may be able to recoup some of the money you would miss out from paychecks.

So how do you make a decision whether you should get limited or full tort insurance? By not covering yourself completely you put yourself at risk. Just how much risk is something that cannot be figured out with mathematics. You’ll have to take a look at your driving record, how long your daily commute is and the safety rating of your car. Plus any other factor that could cause you to become injured in an accident.

You will personally have to weigh your options and compare the risk versus reward. Is saving a few hundred dollars each month worth it? That is something each individual insurer will have to figure out themselves.

What Car Insurance Companies Are Really Cheap?

When looking for car insurance it is important to shop around. Different companies use different metrics in the quotes they provide to you. If you are looking for a cheap car insurance company, the company that offers you a cheap monthly payment may be different then the company that offers your parents a cheap rate.

How is this possible?

Different factors are taken into consideration when a quote is provided to a potential customer. One company may put heavy emphasis on level of education and if you own or rent a home while another may put more weight on your past driving record and they type of car you drive. The fact of the matter is each company has their own formula on how they process their rate quotes.

So how can you get cheap car insurance?

The best way to get a low insurance quote is to shop around. Take some time and get quotes from multiple companies. Or use our site which lets you compare car insurance rates. By getting multiple quotes you’ll be able to find a auto insurer that quotes well for your specific demographic. Whether you live with your parents and have a beat up Jeep Cherokee or own a home and drive a fancy sports, there is an insurance company out there that will provide you with quality insurance at a low cost. You may just have to work to find them. Start with the big players and use their rates as measuring sticks against some of the smaller auto insurance companies. This will allow you to see if you should be be going with a big brand or a mom and pop shop. If customer service is important to you, you may want to go with a smaller shop that really cares about their customers. If you are solely looking for cheap insurance nothing else, one of the big guys may be the best fit!

Insurance For Classic and Vintage Cars

If you happen to be an antique car collector, covering your cars with auto insurance is not easy. There are many rules and regulations out there that limit companies from providing insurance to classic and vintage automobiles.

So what exactly will you be looking into if you are trying to buy insurance for an older model car? Here is some info you should know before you purchase car insurance.

When the car was made is an important factor. The government began mandating that auto manufacturers begin using VIN numbers in  1954. Before this time, there really was no way to identify the exact car and when and where it was produced. This lead to many people attempting to trick car insurance companies and getting getting large amount of money via insurance fraud. By utilizing VIN numbers, a car can be uniquely identified and it is much harder to commit insurance fraud.

In 1981, the government began requiring car manufacturer’s to use a specific standard format.

When it comes to insurance, car insurance providers consider ‘classic cars’ to be cars built afte1981 that can be identified by their VIN numbers. These types of car are commonly insured by all car insurance companies such as Progressive, Geico and 21st Century Insurance. While rates for the cars may be a little bit higher then newer models, most car produced after 1981 will be covered by standard insurance.

Car produced before 1981 can be considered vintage or antique cars. Cars from this time period are usually not covered by standard car insurance premiums or auto insurance companies. You’ll have to work with companies that specifically work on vintage cars and you may end up paying a higher premium due to the car’s rarity.

It is important to note that insurance for classic cars can often be more expensive then traditional insurance. A person looking for classic or vintage car insurance should make sure to shop around when looking to make a purchase.

Why Are Some Car Insurance Companies Cheaper Then Others?

The car insurance industry is packed with competitive rates, TV commercial, billboards and out bound call marketing efforts. Each company is trying to get you to use their insurance over another, when in actually, their services and coverage are actually very similar. So why are some companies so much cheaper then others?

Sub-Standard Insurance:

Companies that fall into this level of auto insurance are the likes of SafeAuto, The General and Good2Go auto insurance. They offer very low monthly payments and are often way cheaper then the bigger companies.

So how can they afford to charge you less? In the case of sub-standard insurance, these companies only offer you enough coverage so you stay legal. They offer the bare minimum coverage you need to be able to legally drive. If you happen to use on of these companies and are in a big accident, you may be wishing you had used one of the bigger companies and paid a little more each month.

Standard Insurance:

In this set of insurance companies, you’ll find Geico, Progressive and 21st Century Insurance. The coverage available here is what you need to cover yourself if you happen to get in an accident. You’ll find many companies competing for you in this market, all offering savings.

Within this aggressive market you’ll see quite a bit of advertising, specifically on TV and digital channels. What you will also see is companies are very competitive in acquiring new customers. Many different deals are presented to potential customers to get them to switch insurance, so you truly do have a good chance of saving if you switch.

Each company does quite a bit of modeling to better understand the lifetime value of each customer. A customer who pays $100 and stays with an insurer for 5 years is worth more then a customer who pays $125 a month but only sticks around for 1 year.

So why exactly are some insurance providers cheaper then others? A lot goes into that. Some are willing to take a smaller margin on each sale while others have better customer retention rates and less people filing claims. To truly get the best deal you’ll most likely need to shop around and find an insurance provider that quotes very well for your specific demographic and driving record.

Multiple Car Auto Insurance

At some point in each of our lives you may find your self looking for car insurance for multiple people. Whether it your wife, child or even another family member, combining policies can actually help you save money.

Car insurance companies such as State Farm, 21st Century insurance and Geico all offer discounts if you add on additional members to your auto insurance policy. You can expect to get anywhere from 5% to 20% off your current monthly payment. So why do car insurance companies offer this deal?

By combining policies, there is a great chance you are bringing over a new customer to your car insurance provider. With this in mind, they offer you and the new customer a discount to ensure you get them another customer. If they can secure a new customer they can essentially double your worth as a customer.

Where you may run into an increase is when you bring on a teenager. Car insurance underwriters often do not give discounts to teenagers as they have the highest risk. You will often find teenagers have the highest premiums around. So if you have a teenager getting ready to get their license, maybe have them contribute to their monthly insurance costs!

The best advice you can take from this post is if you are looking to put multiple drivers on one insurance policy, you should shop around and get multiple quotes from insurance providers. Different companies will offer discounts depending on where you live and how many drivers you have. So keep your options open and find the cheapest car insurance out there!

RV Insurance

TV commercials are all over the place for car insurance. Recently even Geico and Progressive have become promoting motorcycle insurance. But what about RVs?

RVs are becoming more and more popular these days, as many people are turning to the road instead of flying for their vacation. Flying on major airlines has become extremely expensive and going by RV has become more cost effective. Sure, gas can be expensive, but when you have an RV you do not need to pay for a hotel room.

RV are not easy to drive and cost quite a bit of money. So covering your RV with insurance is very important. When shopping around it is important to know what type of coverage is available and what type of RV insurance you need.

You can get coverage for vacation liability, full time or live in coverage or insurance for emergency expenses. These types of coverage will not only cover your RV but also those who you are traveling with as well as all of your valuables and luggage while you are on a trip.

When looking for RV coverage you may need to make sure your insurance company covers your type of vehicle. Most insurance offerings will cover commercial vehicles, trailers and motor homes but it is wise to ask your insurance rep to make sure your exact vehicle is covered before you commit to a quote.

How To Get Cheap Car Insurance

Everyone is penny pinching these days. People are trying to save money where they can. Whether it is on their electricity bill or on their car insurance, if someone can save a few bucks, they are going to do it.

So when you are looking to get cheap car insurance, what options are available to you?

First, you can call you current car insurance company and see if you can get a rate reduction. Many insurance companies have programs where you can get discounts if you are a good driver. So by staying on top of what discounts are available, you can ask for a decrease in your monthly bill.

Another great option is to head to Google. Many insurance companies with with advertising agencies like Front Street Consulting, to run their SEM and SEO campaigns. These agencies help insurance companies rank and display ads for car insurance related terms. So when you search for something like ‘auto insurance quotes’ you will be presented with companies who are offering cheap car insurance rates. Essentially, there are 10-20 companies bidding and competing for your business. You can simply click on a few ads, get a quote and compare which company is the cheapest.

When you are using this method and attempting to get low cost insurance. You will want to make sure you get the right coverage. Some low cost insurance options do not provide full coverage and it could end up hurting you in the end if you get into an accident. When looking for auto insurance that is cheap, make sure to shop around. That way you guarantee yourself to get the lowest rate.

Motorcycle Insurance

Motorcycles are no joke. They are one of the more stylish ways to navigate the United States. From high performance speed bikes to Harley’s, a motorcycle is one cool way to go around town.

Along with the cool comes some danger. It is no secret that crashing a motorcycle can leave a rider with some very serious injuries. There have been many high profile athletes such as Ben Rothlesberger and Jayson Williams who have had to miss time due to injuries from motorcycle accidents. According to NHTSA, over 30,000 people died in motorcycle crashes in 2010. That is not a small number.

Not to mention over 2.24 million people were injured from motorcycle accidents during that same year. As you can imagine, with numbers like these, motorcycle insurance is a huge business. If you are riding around on a motorcycle without insurance, well you are not very bright. Making sure you are covered so you can take care of medical bills is extremely important. It is not cheap to fix a broken leg and a broken collarbone. Surgeries like that can leave you tens of thousands of dollars in debt.

There are not as many options for Motorcycle insurance as there are for car insurance. Only the major players like Geico and Progressive cover motorcycles. Companies like Good2Go and 21st Century do not cover motorcycles.If you happen to be looking for motorcycle insurance don’t just look for the cheapest insurance out there. Try to find coverage that will cover all of your needs. If you do end up in an accident you want to make sure you cover yourself completely and do not have to pay any medical bills out of pocket.

What Exactly Is A Deductible?

When you purchase car insurance you often have the choice to choose how much of a deductible you would like. The problem is, many people do not clearly understand what a deductible is.

In order to solve this, we figured we would explain what exactly a deductible is in depth, so you can make sure you get the right car insurance and pay a fair amount for it.

To explain it as simple as it can be explained, a deductible is the amount you pay out of pocket before your insurance company takes over and covers the bill. It is common for deductibles to range from $100 to $1000 dollars. There are many schools of thought on how high your deductible should be, but the fact of the matter is, you need to choose the deductible that fits you and your driving record.

Why choose a low deductible? 

A low deductible means you only pay a small amount if something happens to your car and you need your insurance company to jump in. For example, let’s say you get in a car crash and are told to fix your car it will cost $10,000. If you happen to have a $100 deductible, you only have to pay $100 of the $10,000. Not to shabby.

Bu there are some draw backs, low deductibles often come with a higher monthly premium. So each month you will have a higher amount to pay to your insurance company. Overtime, it may add up.

Why have a high deductible? 

If you happen to be a safe driver and rarely need your insurance company’s help, a higher deductible may be right for you. You will have a discounted rate each month but you will have to pay a larger chunk of your fee if you do get into in accident.

Both options provide you with advantages and disadvantages. It is up to you to decide which one fits your driving style and record on the road. Just make sure that you are insured and you buckle up when you get in the car.

What Happens If You Don’t Have Car Insurance

Driving without car insurance is not a very smart idea. But you would be surprised how many people all over the US are driving their cars without car insurance. They are huge liabilities out on the road and could end up causing a lot of trouble for insured drivers.

So let’s say you do not have car insurance or missed to many payments and now have had your insurance lapse. What would happen if you got pulled over?

In certain states, the police actually will confiscate your car. They will call a tow truck immediately, have it picked up and impounded. They will then drop you off at the nearest rest stop or store and leave you there. It is not a pleasant experience. You then have to pay the ticket for not having insurance, pay the fine to get your car out of the impound and pay to get car insurance! You have to show proof of insurance in order to pick the car up out of impound. In the end, it is going to cost you way more money to get your car back then it would have if you just paid that small monthly fee for car insurance.

Situations like these often arise because you cannot afford car insurance. Due to the economic climate and people not being able to hold jobs, an interest in low cost auto insurance options has risen over the past few years. You’ll actually see more people looking to compare auto insurance rates and shopping around than ever before. If you do find yourself thinking about driving without insurance think twice, it could end up costing hundreds if not thousands of dollars. If you happen to get in an accident without insurance you will have to cover the bill on your own. That could means tens of thousands of dollars in medical bills coming out of your pocket! Driving without insurance is not a smart move. So make sure you compare auto insurance prices and get the coverage you need.

10 Tips On Getting Cheap Car Insurance

There are many factors on how you can get a cheap car insurance rate. From shopping around to how old you are, hundreds of factors are looked at when auto insurers provide you with a quote. We compiled a list of a few of the top ways you can save money on car insurance. Check them out and start saving some cash today!

1. Get a garage -  Having a garage on your property and parking your car in your garage can help protect your car from damage. Car insurance companies are aware of this and often give discounts for those who park in a garage.

2. Own a home – if you own a home, chances are you went through a thorough background and financial check from a bank. Car insurance companies will see you as less of a risk and more likely to pay your bill on time. This equals more discounts for you!

3. Shop around – as we have talked about before, different companies have different rates. So you may be cheaper for one insurance provider then another. Make sure you check around with as many suppliers are possible to get a low rate.

4. Get substandard insurance  – there are a few companies out there like Safe Auto, Good2Go and The General that offer sub standard insurance. This type of insurance is about as low as you can legally go. Their rates are cheap, but their coverage is low also.

5. Have a higher deductible – the higher your deductible, the less you will pay per month. Yes you may have to pay more out of pocket if you are in an accident, but you will not have to pay a high monthly bill. It is a small risk, but may be worth taking if you are trying to save money.

6. Combine Insurance Policies – if you happen to have home owners insurance or motorcycle insurance with another provider, bringing them over to your current auto insurance provider and ‘bundling’ can help save you money. If you are bringing over more money to your current provider they are sure to cut you a break.

7. Live in a lower crime area – if you happen to live in an urban area with a lot of crime, you may end up with a high premium. The nicer place you live, the lower your insurance will be. Insurance companies will quote you lower if they know you are in a safe neighborhood.

8. Student Discounts – if you or your child is getting good grades, you can get a discount. Good grades show responsibility and the more responsible your young driver is, the lower risk they are to the car insurance company. That equals lower cost for you.

9. Drive Less – discounts are offered based on the total mileage you drive. Certain companies will offer discounts if you do not use your car for your daily commute and actually walk or bike. The less you are on the road, the less likely you are to get in an accident.

10. Have a better credit score – the better your credit score, the better you rate you will get. As mentioned above, car insurance companies like low risk. Your credit score is a direct correlation of the risk you are. If you pay your bills on time and keep everything on track, you will receive a lower rate.

Those ten tips can help you save a ton of money. If you are looking to save money on car insurance the best option is to shop around and compare car insurance companies.

Make Sure To Register Your Car

When you head out the door and step into your car, you need to make sure you are covered. The piece of metal you are driving around is worth thousands of dollars and you will be driving it pretty fast. You’ll also be driving at the same time as tens of millions of people all across the nation. If you really think about it, you need to make sure you cover yourself with insurance. But you also need to have a few other things lined up correctly to make sure you don’t get in over your head if you happen to get in an accident.

When you buy a car, you need to register the car with the state you are living in. It proves that you have paid taxes to the state and allows you can leave the lot with your new car. If you don’t register your car, you are not allowed on the road. States need to keep track of all of the vehicles on the road so they can make sure each is covered with insurance.

If you happen to get pulled over for a violation and do not have you car registered, the cop can write you a pretty expensive ticket. Also, depending on the state you live in, your car can be impounded. If you get your car impounded, it can cost you hundreds of dollars to get it out.

The moral of the story is you not only need to get insurance for your car, make sure it passes inspection but you also need to register your car and make sure you do it each and every year. Save yourself some money and make sure you stay on top of it.