An insurance premium is the amount of money an individual pays particular times for a specified period so as to insure their property or life in case of an unforeseen event that will lead to the loss of either. Insurance companies can be a bit stubborn when it comes to compensation. They will look for all possible ways to make sure that before compensation in case of anything, they are compensating an event that was in deed an accident. Here are some of the factors that may affect an insurance premium
Before being issued with an insurance premium, they look at factors like ticket history and involvement in accidents.The annual mileage is also very crucial. The more the car has been on the road, the likelihood of accidents occurring is high and vice versa. People who have no ticket history or any accidents history are considered responsible and they can get affordable premium.
The model of the car also plays a big role in getting insurance premium. For example, an expensive car like a Lamborghini may be a bit costly to repair in case of an accident. Its parts are also hard to find. A Toyota on the other hand is cheaper, and the parts are so easy to find at an affordable price as well. Therefore, when getting insurance premiums, the one with a Lamborghini will pay a higher premium as compared to the one with a Toyota.
The credit score of the applicant will be used by the insurance companies to determine the premium. A bad credit score means that a person may not be able to pay the premium as agreed due to financial difficulties. They will therefore be highly charged so that they can avoid the possibility of skipping the payment is covered.
Age, Address, and Occupation
As much as we may think that age is a trivial issue, insurance companies look at it as a big factor. Young drivers may be a bit inexperienced while old drivers may have visual impairment, so both are high risk drivers. Locations that are not safe may have high theft rates. Therefore, the car is at a higher risk of being vandalized. Stressful occupations like real estate that pay well are also considered. All those factors will lead to the insurance companies to ask for higher premiums from the applicants.
It is good to have such information so that when applying, one can know what to expect.