Whether you’re buying a new vehicle, adding a new driver to your policy or shopping around for the best rate, it helps to know what factors can affect your car insurance premium. Here are seven things that can raise car insurance rates.
1. Where You Live and Park
Not only where you live, but also where you park, can be factored into the cost of insuring you and your vehicle. Location demographics — crime, theft and vandalism rates, population densities and weather patterns — can have a direct impact on determining your rate. There’s no need to move just to save a little on car insurance, but being aware of these factors can help you understand the cost of your coverage and why your car insurance might increase or decrease if you move.
2. What You Drive
When it comes to purchasing a new ride, there are hundreds of makes and models to choose from. You’ve probably given a lot of thought to the make and model, year, price tag and features, but did you know the type of vehicle you purchase can impact your premium and increase your rate? Some cars cost less to insure than others, depending on various factors.
- Make/model: A sports car may sound exciting, but sportier cars — especially those known for their speed — often carry higher insurance rates. SUVs, too, may seem appealing because of their larger size, but premiums are often higher because of the damage these large-sized vehicles can cause.
- Engine size: Vehicles with bigger engines may drive up your premium because they have more horsepower. On average, a six- or eight-cylinder vehicle has a higher premium than a four-cylinder model.
- Theft rating: Insurance companies monitor vehicle theft rates. If your make or model has a higher chance of being stolen, your premium may be higher.
3. How Much You Drive
When you apply for an auto policy, you’ll be asked how many miles you drive on average. How much you drive can affect your car insurance rate. This is because statistics show the more miles you’re on the road, the higher your chances of being in a car accident.
4. Your Driving Record
Your driving record can impact your auto insurance premium. If you have a good driving record, you may pay less. But if you have a poor driving record, your premium could increase. Speeding tickets, for example, can increase the amount you pay. If your premium increased when you renewed your policy, that speeding ticket may have been the factor that caused your car insurance rate to increase.
5. Purpose of Your Vehicle
If you use your vehicle for business, you’re likely on the road more often than the average driver. This can put you at a greater risk for an accident and increase your auto insurance premiums.
6. Your Deductible
The amount of your deductible can be adjusted based on your preference. Choosing the deductible amount that best fits your needs is important. Raising your deductible will lower your premium, but will also cost more out of pocket if you have a claim later. Get caught up on everything you need to know about deductibles to help you choose between lower and higher options.
7. Your Age
Younger drivers are less experienced and often pay higher premiums. Our Young Driver Safety Program encourages safe practices behind the wheel; young drivers (age 25 or under) who complete our program and meet several basic eligibility requirements can earn a discount on their premium.
Ways to Save
Many factors that affect car insurance rates cannot be avoided, but we offer a variety of discounts to reward you for driving safe. Learn more about how your safe driving practices can save you money with Driveology®: The Science of Safe Driving. If you haven’t reviewed your policy in the last year, now’s the time to schedule a SuperCheck® with your Farm Bureau agent to be sure you have the right coverage and best rate.