How to Calculate Car Insurance?
The cost of a car insurance policy is determined based on factors specific to the insured driver and policy features. Driver history, vehicle type, average miles driven, coverages included, coverage limits, as well as deductible amounts, are some of the things that can affect the cost of a car insurance policy. For example, the lower your deductible, the higher your premium may be.
To calculate the cost of car insurance, you will need the following information:
- Your address
- Type of car insurance/coverage you need
- Credit score
- Year, Make & Model of car(s)
- Marital status
- Vehicle use type
- Licensed drivers
- Driving record
- Claims and insurance history
Once you have gathered this information, reach out to The Hartford for a car insurance quote.
How Is Car Insurance Calculated?
Many factors are used to calculate car insurance costs. These include coverage options, coverage limits, the amount of your deductible and others. Insurance companies generally set rates that will allow them to pay the costs of expected claims, plus other business expenses. In most states, the state’s insurance department must review and approve a company’s rates before they can be put into effect. Some of the most important factors used when calculating car insurance are:
Your driving record – It’s one of the most significant factors when determining your premium. If you have a driving record of no violations, it indicates that you are a less risky driver and this would typically result in a lower car insurance cost. Learn more about the DMV Point System in our blog post. Because your car insurance policy is designed to offer protection, your insurer will try to analyze the likelihood that you’ll have an accident.
Your gender, age, and marital status – Age is directly related to experience in the eyes of your insurer. The more driving experience you have, the less likely you are to cause an accident; therefore your rates will likely be lower. Women typically pay less for car insurance1, and statistics show that married drivers are less likely to be involved in an accident than single drivers.
Where you live – Accidents are frequently caused by factors outside of our control, but if you live in an urban area with heavy traffic and a high rate of theft, your premium could be more than a driver who lives in a rural area with few drivers and a low crime rate.
Make and model of your car – If you drive a newer model car that recently scored high in crash safety tests, you may be eligible for lower rates than a driver in a higher risk car. Safer cars mean fewer and less serious injuries, or less risk of injuries and fewer claims for medical payments and damages. To save money on insurance, consider choosing vehicles with the latest safety features and highest safety ratings.
Every insurer calculates their rates differently using their own proprietary methodologies. Because the formula used to calculate your car insurance rate will differ between insurers, it’s important to compare insurance quotes carefully and choose the policy that’s right for you. Remember, cost should not be the only determining factor. The lowest priced policy may not provide the value and protection you’re looking for.
How Much Car Insurance Do I Need?
Most states require drivers to have bodily injury and property damage liability insurance. These coverages can help pay the cost of damages if a driver hurts another person or damages property while driving. Most states require a minimum dollar amount of coverage.
Find out the minimum car insurance requirements for your state. A general rule of thumb to determine how much car insurance you need is to calculate the total value of all your assets and buy coverage equal to that amount. So, if the combined value of your house, other property, car, savings and investments equals $200,000, consider car insurance coverage of at least $200,000. You may also want to buy personal injury protection, medical payments, uninsured/underinsured motorists bodily injury coverage, collision insurance and comprehensive insurance.
Why Choose The Hartford for Car Insurance?
Car insurance companies aren't all the same. At The Hartford, we offer more than great rates. We offer extra benefits that protect the lifestyle you've created, and personal service to make your life easier. And of course, we can help you choose the coverage that is right for you.
Car insurance isn't one-size-fits-all. The coverage you need depends on the drivers and vehicles on your policy and how much you have to protect.
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Get a free quote from the AARP Auto Insurance Program from The Hartford, it’s simple and takes just a few minutes. Start now!