Auto & Home Insurance 101: WHY AND HOW ARE AUTO POLICIES PRICED ... - Island Gazette

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Published on Wednesday, 18 July 2012 23:55

Written by Super User

Steve Bowman, Property & Casualty Insurance Broker

Drivers are grouped according to level of risk which is the amount
of loss incurred by insurers within these categories. 
• Sex : Men  have more accidents than women.
• Age:  Drivers under 25 are considered higher risk having an accident.
• Marital Status:   Married drivers have fewer accidents than single.
• Personal Driving Record:    Years of experience, accidents, speeding tickets and drunk-driving offenses determine the risk you pose.
• Use of vehicle:    Business drivers or drivers who commute to work are of greater risk   than drivers  using vehicles for errands and recreation.
• Type of Vehicle:   Value, weight, size, age and cost of replacement parts determines price.
Larger, heavier vehicles are at  lower risk  than smaller, lighter ones.
Expensive cars cost more to repair than economy models. Cost is based on average cost covering actual losses, spread out in your "rating group". You may never need compensation, but others in your "group" may not be as fortunate. Your premium will help pay for these losses, just as their premium pays for yours.
From the office of: Steve Bowman, Property & Casualty Insurance Broker, 106 K Ave. Kure Beach, NC 28449 : Phone 910-458-1164 : 800-542-2502 : Fax 910-458-7311
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