Factors that affect car insurance premium

Hoping to get lower premiums on your car insurance? Then, know the factors being considered when insurers calculate your premiums.

10:21 24 July 2013

Car insurance is not a “want” but a necessity, as it offers protection against liability should unforeseen incidents happen while you’re driving. But do you ever wonder how premiums for this type of policy are calculated?

There are several factors that insurers take into consideration when they’re determining the rates to offer you and these include the following:

• Your driving profile. Your insurer would want to know how often you use your car and the amount of miles you drive annually.

It will also take into consideration your history to determine if you’re a responsible driver or not. Insurers will be more than happy to lower your premiums if you can convince them that you are more unlikely to get into road accidents.

• The type of car that you drive. Aside from your driving profile, the insurer will also take into consideration the type of car that you have. They will consider the cost of possible repairs or the cost of replacement should it get stolen or damaged.

 

• The type of coverage you need. Obviously, the more coverage you ask for, the higher your premiums will get.