How car insurance prices are calculated:
The amount you are charged by an insurance company is a reflection of how likely they think you are to make a claim and how expensive that claim is likely to be.
An underwriting company will evaluate your application and will review the information you have provided. There are a range of factors that will be used to calculate insurance prices, such as:
Your Age:
This is a significant factor as the younger you are the higher your premiums will be. As an older driver with more experience on the road you will be considered to be a lower risk and less likely to get into a car accident.
Your Job:
If you are asking yourself what your job has to do with your car insurance prices you need to consider the fact that insurance providers assess how often you drive because of the type of job you have. If you work from home for example, chances are that you don’t spend too much time on the road. To an insurance company, this means that you are less likely to get into an accident and claim too often. The reality is that certain occupations meant that you spend more time on the road or you work in high-risk areas.
The Car You Drive:
The car that you drive has a big effect on car insurance prices.
Value – The more expensive your car, the more its costs to repair it.
Power– The faster and more powerful your car is, the more expensive it is.
Modifications– If you add modifications to your car, this will bump up your car insurance prices. This is mainly because your car is more likely to become a high-risk vehicle.
Desirability– If your car is considered to be high-risk and at risk of theft, this can increase car insurance prices.
