Stuff that Affects Your Auto
Insurance Premium
Insurance companies will use a number of criteria to establish your individual premium. These include:
Your age, and, for younger drivers, your marital status. Male drivers under 25 and unmarried women under 21 have the highest rates. (Strangely, though their judgment should be seriously questioned, married women under 21 get better rates!). Drivers over 50 may get discounts (they drive more cautiously, drive less often, and, let's face it: their big Buicks are practically indestructible).
Your driving record and claims history. A good driving record will save you money. If you have accidents or tickets on your driving record, you very possibly can be placed in a nonstandard company that charges higher rates. All insurance companies are entitled to add penalties - called surcharges - to your premium for major driving offenses and accidents resulting in property damage of $1,000 or more. In fact, surcharges are mandatory for rate-regulated companies and stay on your premium for three years.
If your driving record stinks, you can expect to pay more for your insurance. Companies may pile on surcharges to your premium (some as high as 60 percent!)for the following:
- accidents (the more accidents, the higher the potential surcharge)
- moving violations (speeding, racking up points for pedestrians, etc.)
- involuntary manslaughter
- driving under the influence
- criminally negligent driving
- driving without a license or with a suspended license.
The county where you keep your car. Because urban counties have more accidents, auto thefts and nut cases in general, city rates tend to be higher than those in bubba land.
The type of car you drive. Collision and comprehensive rates are highest for luxury, high-performance, and sports cars. Typically, rates are also be higher for cars that damage easily or cost more to repair than others. Ironically, the higher rates apply to your Yugo for this reason.
How you use your car. Rates are higher for cars driven to and from work or used for business. Ideally, to get the very best rates, you should park your car in the garage and drive it only on June 24.
Your credit score. Many companies consider your credit score when deciding whether to sell you a policy and what to charge you. However, even if you're a total slacker, a company cannot refuse to sell you a policy or cancel or nonrenew (this is an actual insurance word) your policy solely on the basis of your credit. Companies that use credit scoring must file their models with the Texas Department of Insurance.
Whether you have driven uninsured in Texas. Companies can charge more if you have arrogantly (or forgetfully) driven around uninsured in Texas for more than 30 days in the 12 months before you applied for insurance. Sensibly, however, a company cannot charge you a higher rate for liability coverage because of your prior lack of coverage.
Companies must file their underwriting guidelines with the Texas Department of Insurance and update them each time they make a change.
Auto Insurance Demystified | How to Buy Auto Insurance
Stuff that Affects Your Auto Rates | High Risk Driver Insurance
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