Everyone wants the lowest car insurance premium they can get, but there are a number of factors that affect how high or low your insurance costs will be – and not all of them are within your control.
From where you live to your marital status, here are five variables that will affect your car insurance premium, for better or for worse.
1) Your postcode
Where you (and your car) live plays an important role in your car insurance premium. Your insurer will assess the claims history, crime rates and even available off-street parking in your local area – among other factors – and use these to help determine your premium.
As a general rule, car insurance for city slickers will come with a heftier price tag than for those in regional areas.
2) Accidents and claims
If you have an at-fault accident, it’s reasonable to expect your premium to rise. Likewise, the amount of times you make a claim will also impact your overall insurance costs. On the other hand, drivers with a history of safe driving and no at-fault accidents will generally enjoy lower premiums.
Insurers look to reward drivers with a good driving history and who don’t often make claims – these drivers are considered low risk and thus can be insured for a lower premium.
It’s also worth noting to be wary of lending friends your car. If your friend borrows your car and has an accident, it’s you who will have to file a claim with your insurer. If your friend was at-fault, this will generally result in a higher premium for you.
3) White lies
Fudging on your car insurance details a little may not seem like a big deal – and it probably won’t be – until the day you need to make a claim.
Car insurance claims are frequently rejected if the information you have provided on your car insurance policy turn out to be incorrect. This could be anything from your claims history, modifications to your vehicle, a change in location, or even just driving your car more often.
Make sure to inform your insurer about any changes in your circumstances that have an impact on your vehicle. It’s always better to be safe than sorry.
4) Your mileage
How much you use your car is always going to impact the cost of your premium. Those who only drive to the train station will generally enjoy a lower premium than drivers who spend an hour sitting in peak-hour traffic each morning.
At the same time, people who use their cars for work – such as tradesmen or salespeople – will most likely find themselves footing the bill for a higher premium than train commuters. The risk is just that much greater.
5) Age, gender and marital status
There are a number of factors that mostly rest outside of your control, but these will nonetheless impact your car insurance premium. Basic demographic details such as your age, gender and whether you are married or single will all play a part.
The premiums of younger drivers are generally higher than that of the more experienced, and men frequently have higher premiums than women. Married women with children are considered one of the lowest risk car insurance demographics, whereas younger men and P-platers are some of the highest.
Your car insurance premium has more variables than you may think. While not all of these factors are within your control to change, one of the most effective ways to lower your premium over time is by having a clean driving history.
No at-fault accidents and few claims over the years will make you the ideal car insurance customer. Focus on the big picture of being a safe driver, and you should see your premium become more affordable in the long run.
Take a look at the competitive car insurance premiums available with NRMA Car Insurance.