Motor vehicle premium rates vary based on a variety of factors. Knowing how insurers calculate your premiums can help you control the cost of your insurance.
What Affects Rates?
- Size and performance of your vehicle – Smaller cars can increase your premium, because they sustain more damage in collisions. High-performance vehicles, such as sport cars, tend to be driven more aggressively and therefore often incur a higher premium.
- Value and age of your vehicle – The more expensive and new a car is, the higher the premium.
- Vehicle usage and location – The more kilometres your vehicle has travelled, the higher the premium. Additionally, where you drive and store the vehicle affects your rates as well. If you are in a more densely populated area, with a higher risk of theft or accidents occurring, your premium will also be higher.
- Age and gender – Statistically, younger drivers are at a higher risk of getting into an accident than older drivers. Studies show that males under the age of 25 get into more collisions than their female counterparts. Insurers adjust premiums for different statistical groups to reflect these findings.
- Your driving record – Drivers with past claims are more likely to have future claims. Because of this, your driving history directly affects your motor vehicle policy rates.
- Your excess – If you choose to pay a higher excess, your premium will be lower. Keep in mind that this means you need to have more cash in hand if an accident occurs.
How Can I Control My Rates?
Many insurers offer discounts based on your vehicle’s safety features—such as anti-lock brakes or anti-theft devices—or for having multiple cars on one policy. Your behaviour as a driver can also impact your rates.
Here are some tips for keeping your premium low:
- Research before you purchase. Find out how the size, performance, value and age of the vehicle you are looking to purchase will affect your premium compared to other vehicles you may be considering.
- Choose a higher excess, but make sure to stay within your means.
- Do not drive while fatigued or under the influence of drugs or alcohol. Never text and drive. Avoiding these behaviours will lower your chances of getting into an accident, which will help your driving record stay clean and your premium low.
- Drive defensively.
- Drive less. Walking, riding your bike or taking alternative transport to get from place to place could help you qualify for an infrequent driving discount.
- Consider purchasing a car with more safety features.
- Install an anti-theft device. This is an easy way to deter one type of car emergency that would raise your premium.
- Keep your credit in good shape.
- Consider excluding high-risk drivers in your household from your policy. If you choose to do this, make sure these drivers do not get behind the wheel of your car.
- Ask C R Toogood & Co Limited about multi-policy discounts.
Learning about how motor vehicle insurance rates are determined helps you to navigate varied rates, make smart motor vehicle buying decisions and control the cost of your insurance. If you have questions about your motor vehicle premium, contact C R Toogood & Co Limited today.