What factors affect the cost of car insurance?

What factors affect the cost of car insurance?

There are many factors that affect the pricing on your quote, including the type of policy you have, the vehicle you drive, deductibles, usage, credit, driving record, bundling and location.

  • Your vehicle: Car insurance providers often develop vehicle safety ratings by collecting data from customer claims and analyzing industry safety reports. Discounts are usually offered to customers who drive safer vehicles, while some insurers increase premiums for cars that are more susceptible to damage, occupant injury or theft.
  • Deductible: The amount you must pay when making an insurance claim. The higher your deductible, the lower your premium may be. However, some loans have requirements and may only allow you to carry a certain amount.
  • Credit: Many insurance companies use consumer credit information as a part of their underwriting process, which may affect the premium charged. However, companies are prohibited from rejecting an application for insurance solely on the basis of credit information.
  • Driving record: Drivers who cause accidents and/or have violations generally must pay more than those who have gone ticket/accident-free for several years. Taking a defensive driving course can help lower your premiums.
  • Bundling: Most companies offer a substantial discount, sometimes up to 25%, for bundling your home and auto insurance together.
  • Location: Due to higher rates of vandalism, theft and accidents, urban drivers generally pay more for insurance than those in small towns or rural areas.


Should I bundle my home and auto insurance together?

Bundling your home and auto insurance with the same carrier will usually result in a discount on both policies. In addition, if both your property and your car are damaged in the same event, such as in a garage fire or due to a falling tree, you would only have to file one claim and pay one deductible.


However, you shouldn’t choose to bundle your home and auto insurance without being aware of options from other carriers. Your HUNT Insurance agent can help you compare and contrast policies to find the solution that will provide you with the best value and protection.

What is the minimum car insurance I need?

New York State Law requires all vehicles to carry a minimum amount of liability coverage. These limits are:

  • $25,000 for bodily injury to one person
  • $50,000 for bodily injury to two or more persons, which is the maximum that would be paid regardless of the number of people injured
  • $10,000 for damage to property of others
  • $50,000 for personal injury protection (PIP)

Uninsured motorist protection is subject to the same minimum coverages.

HUNT Insurance recommends that our policyholders carry much higher limits. Due to the rising costs of vehicles and claims, those minimum limits will be used to their full capacity, leaving policyholders susceptible to a possible lawsuit.

Why did my car insurance increase for no reason?

It is important to remember that the grounds on which insurance is based is to share the risk and shoulder the costs with others. Even if your driving behaviors have not changed, everyone is impacted by the following:

  • Worsening traffic: Increased population, lower gas prices and higher employment rates all mean more cars on the road and, inevitably, an increase in accidents.
  • Distracted driving: Each day, more than nine people are killed in crashes related to distracted driving. From texting and driving to eating and drinking, anything that takes the driver’s attention off the road more than doubles a driver’s chances of getting in an accident.
  • More claims: Research has shown that the average cost and frequency of claims have been on the steady rise since 2005, resulting in higher payouts.
  • Rising costs: As the costs of groceries and everyday purchases are increasing, so are the costs of vehicle repairs. Cars are more advanced and safer, but the advanced technology also makes them more expensive to repair.