Insurance can be a daunting topic for a lot of people, but it doesn’t have to be. If you are shopping for a new insurance policy the best piece of advice we can give you is to ask lots of questions! This article is going to address one of the most common questions we get asked: why are my insurance rates so high?
Insurance rates can be a baffling mystery for those who aren’t familiar with the insurance industry. While it may seem like an arbitrary number at first, the truth is insurance rates are mathematical in nature and always based on trends and data.
That means that if you can identify and improve key factors that insurers use to calculate rates, you can lower your own monthly premiums. These are a few factors that most insurers take into consideration when deciding on your insurance rates.
One of the most obvious, and most important, factors that almost every insurer looks at when determining insurance premiums is credit score. A low credit score makes you a riskier bet, which means your insurance rates will go up. Taking the time to fix your credit is not only good for your finances in general, but it can save you a significant amount of money in insurance premiums.
What many people don’t realize is that their actual physical location plays a big part in their insurance costs. For example: If you live in Colorado, you’re homeowner’s insurance rates are going to be higher because of wildfire concerns. Do you live in a big city? You’re going to pay more for health insurance because of it.
Remember, insurance rates are all about data. If the data shows your geographical area is at a higher risk of something, you’re going to pay for it with your insurance rates.
Demographics: Marital Status, Gender & Age
Young men are at higher risk of getting into a car accident, so they pay more for car insurance. Conversely, married couples tend to file fewer claims than single people, so they also usually pay less in insurance premiums. Whatever the data-based trends say, your premium will reflect.
What Do You Drive?
Driving is one of the single biggest factors that can raise car-insurance rates. The more you drive, the more time you spend at risk of getting an accident. Do you have a long commute to work? You’re going to pay for that with more than just your time.
What you drive can also play a role in your insurance costs. Newer cars tend to come with more safety features, so they tend to cost a bit less to insure. Of course, newer cars tend to be a lot more expensive, which will raise your rates. It’s all about finding the right balance for your lifestyle.
Insurance can be confusing, but it doesn’t have to be. Take the time to do your research, and consult with experts! The staff at TGS Insurance are always willing to work with you to find the right policy for you. Visit www.tgsinsurance.com to learn more. No matter what kind of policy you want, it’s important to get one that has the coverage you need, at a price you can afford.