May 25, 2011

When Low Premiums For Auto Insurance Are Not Possible

You may see many advertisements on television or the internet for low premiums on auto insurance. If you have stayed with the same carrier for a certain amount of time it may be possible to switch to get a cheaper policy or rate. However, there are some cases when a low premium just simply is not possible. If you recently purchased a new car and are still making payments, you are seen as a reckless driver by insurance companies, and your age can all be factors to higher auto premiums.

Full coverage must be obtained for the purchase of a new car or truck. Technically, you have not fully paid for it yet. So to protect the lien holder you will pay for higher premiums to ensure that if something should happen to the car the loan is repaid. If there is anything left over after paying off the vehicle you receive that portion.

Your driving history will affect the amount of your car payments. Low premiums are only provided as an incentive for excellent drivers. If you have had plenty of car accidents where you were at fault, speeding tickets, or non moving violations which added points to your record will label you as a bad driver. It takes three years before any incident that you created is not used against you for the cost of your insurance. However, it is still seen by insurance companies and if you stay with the same carrier they will calculate this within their cost for coverage.

Young adults and teenage drivers are considered high risk. Anyone under the age of 25 often has the highest premiums. This is due to the fact that they do not have a long driving record. Many will not have plenty of driving experience and past history statistics show that most accidents are caused by those with lower driving history. Adding a teenage driver to your auto insurance will raise your rates.

Luxury vehicles cost more than standard cars. In order to be able to pay for possible damage or total loss that can occur, rates must be high enough to recoup for these costs. The higher the value of your vehicle the higher your premiums will be to the insurance company.

The popularity of a car can also increase the rates. This can have a negative effect on the price you pay for auto insurance. There is a list that is published each year as to the top ten cars or vehicles that are stolen. If you own one of these cars then you rates will rise as the possibility is greater that you could be the victim of vandalism or car theft.