At First Step, we shop with dozens of insurance companies to ensure you have quality coverage at an affordable price. Every auto insurance company is unique regarding the coverage options and discounts they offer. Our agents can make the shopping process easier by asking the right questions to get you qualified for every discount available. Clients often wonder why they are paying so much for auto insurance, so we created a list of the most important auto insurance rating factors
Driving History and Claims
If you have ever received a speeding ticket or been involved in an accident, chances are you’ve seen your auto insurance rates increase. It’s important to know what is on your driving record and to understand the difference between the types of auto claims (At-fault, Not-At-Fault, Comprehensive). An At-Fault claim will generally have the highest impact on your rates than any other type of claim. It is also important to make sure that you take a Defensive Driving Course to help remove any moving violations from your record.
Age of Driver
This is the most significant rating factor, especially for young drivers. Insurance companies view young drivers riskier and much more expensive to insure. If you are adding a young driver it’s important to consider the value and performance of the vehicle they will be driving. The faster the vehicle the more expensive it is to insure. We have listed a few other discounts that may apply in the table on the right.
The higher the vehicle cost to repair or replace the higher your insurance cost. It is also important to remember that newer cars are much more complex which means that the cost of parts and repairs are much higher than they were in the past which in turn has been causing insurance rates to increase. Call your First Step agent to get a quote on any vehicle BEFORE you buy!
The longer you maintain continuous coverage without a lapse, the better your rate will be with the insurer. Insurance companies also check your previous liability limits as well. Drivers who maintain higher limits of liability are considered more “preferred” clientele and will receive a much better rate than drivers who maintain state minimum coverage. Purchasing higher limits of coverage will not only provide better protection but will save you a ton of money in the future!
Auto insurance companies rate vehicles based on state and zip code. Every state requires auto insurers to follow their state’s regulations and minimum requirements. For example, if the same household moves from Texas to New Jersey, their coverage limits and premium will change. The vehicle’s garaging address helps insurance companies adjust for external factors associated with the area such as floods, hail, wildfires, crime, and population. A vehicle that is garaged in a densely populated downtown area will generally pay more for insurance than a car in a more rural part of the state.
Auto Insurance Discounts
If your child is 25 years old or younger and is a full-time high school or college student and maintains a 3.0 or above GPA or equivalent, they qualify for the Good Student Discount. This potentially can be a huge saving for families especially if they have multiple drivers and vehicles.
Car insurance companies have adopted technology used to monitor driving habits such as aggressive acceleration and braking. The actions can be recorded by installing a small device in your vehicle or an app for your phone. Insurance companies will typically reward clients for initially signing up for the program and upon renewal if they deem the driver to be low risk.
This is the biggest discount offered by auto insurance companies. Some insurers offer discounts as high as 30% off the combined premium! Placing your home/auto insurance with the same agency not only saves you money but makes your life easier having one place to call for all insurance needs.
This discount is mostly limited to seniors, teens or inexperienced drivers. It is also very important to complete a Defensive Driver course if you receive a speeding ticket. Doing so will remove the violation from your record and save you money on your auto insurance renewal.
Combining all household members and vehicles onto ONE policy will always be much less expensive than purchasing separate policies for individual drivers.