A lot of what you hear about auto insurance is hear say and a good bit is also assumption. But quite a few facts are actually accurate.
Urban dwellers pay more insurance: Fact number one is that people who live in urban areas tend to pay more insurance than people who live in more suburban or rural areas. This is attributed to that fact that cities tend to have more people claiming on their insurance policies, simply because there is so much more traffic, people, accidents and crime. In general this will mean higher rates for the urban dweller.
Comprehensive coverage versus collision coverage: Another thing is that comprehensive coverage will only cover natural or no fault disasters such as hail and fire damage. If you have comprehensive coverage, it will cover the costs of damage associated with vandalism, animal, hail or fire accidents. However, if your vehicle bangs into another vehicle, your collision coverage comes into play. A speeding ticket may not necessarily hike your insurance rate but, an accident will. This applies even if you are not at fault. The difference is that accidents that you are responsible for have a direct impact on what you pay, but accidents that you are not responsible for could cause you to be placed by the insurance company in a group of clients who get charged higher rates for careless driving or driving under influence.
Age factor: For the younger crowd, age comes in handy: rates tend to decrease once you turn 25. That’s because most current data suggests drivers 25 and older tend to claim on their insurance less frequently.
Grouping clients: If there is a group of clients sharing some characteristic features, an insurance company will most likely group them together. This is just common practice in the industry – since drivers are rated based on the information collected by the insurance companies. This predicts what kind of driver you are going to be. If you lend anyone your car, it’s best to remember that once they take the wheel they are covered as long as you have insurance. If the driver does not have insurance and your car is in the center of a collision, you might be held responsible for any damages that might occur. This could make your rates go up.