There are many factors combined that contribute to the amount of money you will have to pay to maintain auto insurance in the state of California. Most of them you probably would never have thought of. Some you can change for the better to make your premiums lower, others you cannot do anything about, and they just have to work themselves out over time. The following is a list of some of the major factors that contribute to the cost of your auto insurance premium:
Where you live
The area you live in can have a big effect on the base rate of your insurance premium. The farther you live from municipalities and access to emergency or towing personnel, the more you will pay for insurance. Large open areas also have a tendency to have higher speed limits and less traffic, increasing the risk of high-speed accidents. The same applies if you live in an area that is higher in auto theft than others are. In most cases, it is not worth moving just to save money on your car insurance, so this may be one thing you just have to live with.
Your age, sex and marital status
Male drivers under the age of 25 pay the most for car insurance premiums than anyone else. This is the group with the highest accident rate and usually is involved in the most costly accidents. Females under 25 pay more than older females, but still not as much as males in the same age group. Marriage can cause a substantial drop in the cost of your car insurance premium, as the thought is if you are married, you will be a more responsible driver. Getting married to someone just to lower your car insurance is not advised, but when you do get married, you definitely want to inform your insurance company so they can adjust your rates.
Use of the vehicle
How much and for what purpose you drive your vehicle will affect your premium. If you only drive a vehicle a few thousand miles a year, you will pay considerably less than someone that uses his or her car on a daily basis for work as a delivery vehicle. The more you drive the more likely you are to be involved in an accident; therefore, your premiums are higher. If the vehicle is only for farm use and is never driven on regular roads, you may not even have to insure it at all, but contact your insurance agent to be sure of this. Just make sure that when you get a policy on your vehicle you are up front with them on the use of the vehicle, or your policy can be cancelled.
Driver Education discount
Driver Education courses are mandatory for teenagers, but some companies offer these same types of courses for adults. The idea of these courses is to teach teenagers the rules of the road and how to drive safely. For adults a refresher course gets them up to date on driving laws and safe driving in inclement weather as well as other points. Check with your insurance agent to see if one of these courses will benefit you if your premium is higher than you would like it to be.
Good student discounts
In order to qualify for this the driver must be a full time high school or college student over the age of 16. If you are an older student, your insurance company may have a discount program for you, but usually it if offered to those 25 and under. To qualify for this a form must be signed by the school administration every semester to verify that the student is maintaining whatever the scholastic requirements are that the insurance company requires. For most insurance companies a student needs to maintain at least a high “B” average to qualify for any type of discount on their insurance premium. With the high cost of insurance premiums for those under 25, these discounts can make a big difference.
Year, Make and Model of the Vehicle
The year, make and model of your car, as well as engine size, can make a sizeable difference when it comes to insurance premiums. This is especially true for those under the age of 25. Aside from most parents not wanting their child to drive a sports car, the cost of the insurance is probably more than a house payment. Choosing a safe and fuel-efficient car for you teenager is the best way to be sure the insurance will not cost you more than the car. For anyone under 25 a sports car is going to be very expensive to insure no matter how many discounts you can apply. For those over 25, the same rules apply, but age and marital status will bring down premiums a little. In most cases if you have the money to own a Lamborghini, you are not concerned how much you pay for the insurance on it.
Individual Driving Record
The worse your driving record is, the more you should expect to pay for car insurance. The total number of points you have for violations on your license directly affect your premium. If you have an excessive number of tickets or accidents, they may choose not to insure you at all. You might be even categorized as a high-risk driver and required to carry high risk insurance designed just for you. Even if you have a poor driving record, it will not affect you all of your life, most tickets or accidents usually stay on your record for three years then drop off. It is important that once you start improving your driving record, you stay on that path, so within a short amount of time, you will have no violations and able to get reasonably priced insurance through any insurance company.
The higher your deductible the less your premium will be. Simply increasing your deductible from $0 to $500 can decrease the amount of your premium by up to 20%. If you are a good driver and have not made any claims in the past ten years, it is probably a good idea to raise your deductible if you need to lower the cost of your premium. The amount of your deductible is easy to change, and you can change it at any time.
Now that you are more aware of what affects your insurance premium, you can make some changes to help you decrease the amount you are spending. It is always a good idea to drive safely, and not getting tickets or getting in accidents is the easiest way to keep your premium at its lowest. It is always a good idea to discuss with your insurance agent the best ways for you to save money, or what you can do to lower your premium.