If you have an auto insurance policy, what you pay is probably different from what your neighbors pay. This is because the cost of auto insurance premiums depend on a variety of different factors, which include some of the following:
- Your specific coverage—typically, the higher your auto insurance deductible is, the lower your monthly payment will be. Additional coverage may also give you added financial protection, but increase your premiums at the same time.
- The car you drive—your car insurance premiums may be more or less depending on how susceptible your car is to damage, theft, and occupant injury. If you’re planning on buying a new car, do some research on safety ratings before you head down to the dealership.
- Your driving habits—if you use your vehicle to commute an hour each way to the office on a daily basis, your auto insurance premiums will be higher than someone who uses their car to run errands around town a few times a week.
- Where you drive—generally speaking, drivers who live in rural areas pay less for car insurance than those who live in urban settings.
- Your driving record—what’s on your driving record plays a big role in your car insurance rates. If you have several accidents or tickets on your record, your car insurance premiums may increase for several years.
If you have been accident-free for several years and are happy about what you pay for auto insurance, don’t get complacent. Instead, be vigilant about your driving habits to ensure that your premiums don’t end up increasing.