How Your History Affects Your Car Insurance Premiums
When you want to drive a car, and get your driving permit
, a car insurance is the very next step you need to look at. Driving in many states is not permitted without a valid car insurance. That's why you need to find a company that is willing to insure you, and then negotiate what the policy will be, and what kind of premium you'll need to pay. But many factors affect how high those premiums will be. Let's see how your history affects your car insurance premiums.The first thing the insurance sales people will be asking you when you want a car insurance is a list of questions about your history. This includes your driving history, but also other questions, such as health issues, drinking, and so on. Some of the questions may not seem relevant, like whether you smoke or not, but these insurance companies actually spend a lot of time and money coming up with these questions. These are based on extensive studies that assess the risk of many different factors. As an example, perhaps the company has a study that shows them people who smoke are 2% more likely to get into a car accident. It may be a minor thing like that, but it could affect your payments by a couple of cents. Once you add in all of the questions together, your premiums can be affected quite a lot.
It's also important not to lie with your answers. Chances are they won't do much background checks when you get your policy, other than a credit check, to be sure you'll be paying on time. That's because at this point, all they're concerned about is getting your money. But once you make a claim, following an accident, then the first thing they do is go back and do extensive checks on the answers you provided. If they think you lied, then they won't pay. It's better to be truthful, even if you did drink, smoke, or take drugs at one point, your premiums may be higher, but at least your claims won't go unnoticed once it's time for the company to reimburse damage on your vehicle.
It's worth noting that your own personal history isn't the only thing affecting your policy. In fact, the history of people like you affects it a lot more. For example, if you are a 21 year old male driver, your premium will be more expensive than a 21 year old female driver, even if your own personal histories are identical, simply because the insurance companies have studies that show young male drivers are more likely to have an accident than female drivers. This is just one example, and they in fact have hundreds of criterion based on age, gender, health, etc.
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