Car Insurance Pricing Plans

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The law requires liability insurance for all drivers and vehicles. This means that if you are involved in a serious accident, and it was your fault, your insurance company will pay any claims made against you. Additional protection on your own vehicle, called comprehensive insurance, optional.
Car Insurance Pricing Plans

The insurance company based on a number of risk factors will calculate the price you pay for this insurance. Basically how it works is the more they feel you are at risk of crashing, and the more they think that accidents will result their costs, the higher the premium you will pay.


Common factors that will assess the premium is the value of the car you are driving, the vehicle safety, the coverage you want, there will be deductible or limit etc.? How much you will be driving a car, driving record how you stand, how long you have held your license, your age, and if you are young, it is also your sex.

The premiums are then calculated. Typically there is a flat per car, per year rate of paying everyone, regardless of other factors. Other factors will then alter this rate, generally upwards. So if your car especially fast or dangerous your rate will increase by a set amount. If it is very old, your level goes up. If you have one or more accidents in the past, your rate will go up. If you are young and male, your level will go up. More of these factors you satisfy, the more your level will go up.


As sales increase, many car insurers offer discounts on "estimates of future low mileage" for customers who predict that the car mileage will be below some limit declared during the period of the next premium. There is no verification involved and no extra charge if the car is then driven more than the stated amount. Arbitrary discount tends to foster customer trust mistaken idea that the "mile" is only one of many factors classifications are used to raise or lower the price of basic territorial level. In fact, odometer miles (which insurers do not use) is not a factor but the metric - only valid basis for measuring the consumption of each car insurance protection on-the-road use.

Is the best way to save on car insurance to shop around, keep good driving record clean, safe driving and choose a reliable car that is not known for their strength and speed?