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What determines the price of my policy?
There are many
factors that influence the price you pay for auto insurance. The
average American driver spends about $850 a year. Your premium may be
higher or lower, depending on:
- Your driving record.
The better your record, the lower your premium. If you've had accidents
or serious traffic violations, you will pay more than if you have a
clean driving record. You may also pay more if you haven't been insured
for a number of years.
- The number of miles you drive
each year.
The more miles you drive, the more chance for accidents. If you drive a
lower than average number of miles per year, less than 10,000, you will
pay less. For instance, some companies will give discounts to
policyholders who carpool.
- Where you live.
Insurance companies look at local trends, such as the number of
accidents, car thefts and lawsuits, as well as the cost of medical care
and car repair.
- Your age.
In general, mature drivers have fewer accidents than less experienced
drivers, particularly teenagers. So insurers generally charge more if
teenagers or young people below age 25 drive your car.
- The car you drive.
Some cars cost more to insure than others. Variables include the
likelihood of theft, the cost of the car, the cost of repairs, and the
overall safety record of the car.
- The amount of coverage.
Of course, like anything else, the more coverage you have, the more you
pay. However, you may qualify for discounts.
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