Determining auto premium

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Updated: 3/27/2003 3:09 pm Published: 3/27/2003 3:09 pm

Insurance rates depend on many factors. In fact, the costs of identical car insurance policies can vary as much as one hundred percent in the same state. Insurance companies charge applicants according to the potential degree of risk that an individual represents. In most states, certain factors are considered such as age, sex, and marital status. If you are between the ages of sixteen and twenty-five, you will pay more than older drivers because younger drivers tend to have more accidents. The same is true of male as opposed to female drivers and unmarried versus married drivers. Your driving record also plays a big part in determining cost. Drivers who have had more than an average number of accidents or traffic violations almost always pay higher premiums. The make, model and year of your car are additional factors that can affect premiums. The more it will cost an insurance company to repair or replace your vehicle, the more the premium. High performance and luxury cars will also require increased premiums because they have high theft rates and are expensive to repair after an accident. The last major factors determining how much you will pay include where, how often and how far you drive. City drivers will pay more than drivers in rural areas because urban areas have higher theft and accident rates. Everyday drivers will pay more than those who use their cars only occasionally. For more information about auto insurance, consult an insurance professional in your area.

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