Don’t let insurance premiums scare you. An insurance premium is a periodic payment made on an insurance policy. A company charges you a certain amount of money for active coverage which is determined by several factors.
How Are Rates Determined
Statistics are one of the main factors for determining an insurance premium rate to be high or low. Other factors that affect the rate are person’s driving history, age, marital status and health. Insurance rates also vary by area in which you live. Listed below are some other common elements insurers look at when calculating your insurance cost.
Auto Insurance
- The make and model of your car
- Your credit-based insurance score – This is not a factor in all states. Statistics show that drivers with better scores are less likely to get into car accidents.
- How you use the car – Do you use your car to commute through heavy traffic twice a day? Or is it just for Sunday drives? How you intend to use the car can influence what you pay for insurance.
- Prior insurance history – Drivers who haven’t had a gap in coverage are statistically less likely to get into a car accident.
- Your coverages – Of course, this is a big factor in how insurance rates are determined in general. The increase in your premium is due to the amount of protection you need.
Homeowners Insurance
- Rebuilding cost of your home – If your house was totally destroyed, this is the amount it would take to get it back to its former condition.
- Materials that make up your home – Your home’s bones make a difference. Houses built from hard substances such as brick, stone, and stucco (non-artificial) may have a lower rate than homes made of softer and more flammable substances.
- Age of your home – Older houses sometimes have many issues caused by degrading materials. In some cases they contain unique features that are costly to replace. Newly constructed homes tend to have lower premiums.
- Fire protection in your area
- Claims history in your area
- Your personal claims history
- Your pets – Dogs make a cozy addition to the foot of your bed, but depending on their breed, might attract a higher insurance rate.
- Your coverages – Of course, this is a big factor in how insurance rates are determined in general. The increase in your premium is due to the amount of protection you need.
- Your history with your insurance company
Life Insurance
- Type of policy (term vs permanent)
- Family history
- Personal Medical history
- Amount of coverage
Talk to your Yetter Insurance Agent about insurance premiums. We’ll help make sure you get the best value possible. Contact Yetter Insurance today at our Milford office; visitwww.yetterins.com or call 570.296-8329.
