Personal factors that affect your car insurance premiums



Personal factors that affect your car insurance premiums

If you are someone who takes investments seriously, you would find yourself engaging in discussions with your friends who do the same. Often times, while discussing your investments, you may speak about your insurance policies. Through this discussion, you may find that, while both of you have opted for the same car insurance provider, you are paying a different amount premium as opposed to your friend, despite the fact that both of you purchased insurance at the same time. Yes, there are several personal factors, some of which are in your control and can affect the insurance premiums you pay. Let’s find out what they are

The number of claims made by you: Your insurance premiums can increase if you make a lot of claims on your car insurance policy. As the number of claims increase, so does the liability of the insurance provider. You could be seen as an individual who files for claims for the smallest of reasons, costing the insurance provider. This gives the insurance provider the leverage to increase your premium amount. Your claims history and record therefore plays an important role in increasing the premium amounts you pay.

History of traffic violations reported under your name: If you are ever caught driving without your license, PUC (pollution under control) certificate and valid insurance, it is considered as a traffic violation. Other traffic violations include speeding, driving without the seat belt on, speaking on the phone while driving, breaking traffic signals, driving under the influence of alcohol or other intoxicating substances and so on. All these violations are considered serious by car insurance companies. These violations make you a risky candidate to provide insurance to, which is why your insurance premium can be increased.

Change in primary driver: All insurance providers ask you to register a primary driver when you purchase insurance. If the name of the primary driver of a given, insured car is changed during car insurance renewal time, the insurance provider reserves the right to increase the premium amount. This especially happens when you make a relatively new driver the primary driver on the policy. Since a new driver is inexperienced, the chances of claims being filed can increase. Also, premium amounts are increased if you add more drivers to a given policy.

Your location: If you move to a neighbourhood which is more prone to thefts, riots, floods and other instances that can increase risks to your car, you can expect your insurance premium to go up. Car insurance companies specify areas or zones which are regarded as high risk zones. If you are living in any of these zones, it simply means that your chances of filing insurance claims may increase. Your insurance premium can also increase or decrease if you move to a new city, based on the traffic laws governed by that state or city.

Change in number of cars insured under a policy: Another personal factor affecting the insurance premium you pay is the number of cars insured under a single policy. If you buy a new car or sell off one of your cars covered under a policy, your premium amount can change considerably. Most car insurance companies in India offer discounts to those who insure multiple vehicles under one policy.

Apart from these, your car insurance provider can also increase your premium based on certain external factors such as inflation, increased liability claims, demand and supply of a specific cars and parts of cars etc. Therefore, all you can really do is control the personal factors so that your premium amounts remain unaffected.

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