What influences the cost of my auto insurance?

Several factors intervene in the cost of auto insurance, an important one is the profile of the driver.

To determine this amount, insurers use a matrix of characteristics to which they assign a price range.

Based on statistics, they measure which variables are more or less prone to their cars suffering accidents and determine the cost of car insurance.

The highest risks are assigned the highest rates and make the lowest risks cheaper.

The most important factors that companies consider are the risk of collision or theft of the unit.

However, not all insurers use the matrix of measurable factors or incorporate other aspects that they consider relevant, according to their business strategy.

For this reason, sometimes the difference in auto insurance costs offered by insurers for the same model seems incredible.

There are also myths about aspects that people think are considered, such as the color of the vehicle.

Factors that influence the cost of auto insurance

Vehicle characteristics considering the make and model of the car are related to the value of the parts and their equipment.

Here, the ease of obtaining auto parts or whether they have to be imported is analyzed, as well as whether it has a complex security system that reduces the number of thefts of a particular model.

Some cars are more expensive due to factors such as how often they are stolen and their security system.

For example, engine size influences cost, even when comparing vehicles of the same make or model.

The incidence of claims they have is also analyzed. For example, the Nissan Tsuru is an economical model whose insurance is expensive, due to the number of thefts of this model.

This car has been one of the best sellers in Mexico for many years, but its security systems are very basic.

Another factor is the number of units of a model sold and in circulation.

Sex of the regular driver of the vehicle

In statistical terms, women are less likely to have an accident, so their insurance is cheaper.

According to Inegi, the ratio is 7 to 1, in men with road accidents in Mexico.

But this matrix also includes factors such as the number of women who have crashed due to drunk driving or, if they do have an accident, the damage is less severe because they drive more slowly than men.

This is based on statistics, but some women can get out of this trend.

In a considerable volume of cases, their driving is safer than that of a man.

Being married is also a factor that decreases the propensity for risk since a person with a family drives more carefully.

Driver’s Driving History

In the case of people who have purchased insurance with the same company for several years, their performance also counts when considering the cost of auto insurance.

If you are a driver who frequently uses your insurance or has had serious accidents, the price is higher.

It is also considered if you do not comply with traffic regulations and this has caused accidents.

That’s why it’s important to have a good driving record to get a better price for your insurance.

But remember, the cheapest is not always the best, so it is important that you read the insurance conditions before hiring.

If you have doubts, an insurance agent can help you find the best option in terms of coverage and price.

we are here to help you find the right insurance for you in three simple steps.

How often the car is used

This is a very important factor, especially for car insurance per kilometer.

In this mode, the higher the mileage, the higher the risk of having an accident, and the higher the price.

That is why this coverage is ideal for people who use their car for a short time or travel short distances, regularly.

The place where the vehicle circulates

More than registering the place where you live, the insurer is interested in the area where the vehicle travels.

But also the places where it remains parked, during your daily work or at night.

This is because there are areas of greater risk of acts of vandalism or theft than others and this makes the price more expensive.

Typically, large urban areas are riskier than smaller cities, towns, and rural areas.

For example, in Mexico City, it is cheaper to insure a car in Milpa Alta than in Cuauhtémoc or Benito Juárez.

In the Metropolitan Area, there are high-risk municipalities such as Ecatepec or Nezahualcóyotl, due to their high incidence of robberies.

There are also areas with a high potential for flooding, such as the state of Tabasco. This particular factor increases the cost of damage coverage, due to the greater feasibility of affecting this coverage.

Other variables that are considered are the cost of repairing the vehicle, medical services, or the incidence of fraud to collect car insurance compensation.

Type of car use

The function of the vehicle also affects the cost because the activity determines the type of risk to which it is exposed.

A private car, with a fixed route, limited in distance and driven by the same person, is not the same as an Uber car, which spends all day on the street, does not have a fixed route, and travels a greater distance.

The same in the case of a heavy vehicle, which, due to its weight and volume, can cause serious damage to third parties.

The age of the driver

A young person who has less experience behind the wheel increases the risk.

While a mature person, let’s say between 35 and 60 years old, is more careful when driving.

Teenagers tend to be more reckless, more easily distracted, or not assess the risk of violating road regulations.

Consequently, insurers usually charge a higher premium for drivers under the age of 25.

This is because the insurer is interested in who drives the car, more than who contracts the insurance.

But also an older adult driving has a higher risk because his reaction time is slower than that of a young person.

The elderly, as if that were not enough, are losing their visual, auditory, and reaction faculties.

Interestingly, older men drive more safely than older women.

Additional security measures

For cars that have high-quality security devices, some insurers consider these factors to grant discounts.

This variable contemplates that the car has an alarm, electric locks, how feasible it is to force the locks or open the doors by violating the plates.

Also, if they have satellite tracking systems like Lo-Jack and if they stay in a garage overnight.

The type of insurance that is contracted

The cheapest is the Compulsory Civil Liability Insurance, which has basic coverage to deal with a minor accident.

But in the case of a new car, you usually have to take out Plus insurance, almost by force, so that in the event of a total loss, you can recover a higher percentage of the investment.

Between one and the other, there are the Civil, Limited, and Comprehensive Liability coverages, whose range of compensation and price increase progressively.

  1. The importance of honesty

Legally, insurance is defined as a contract in good faith, so the insurer trusts the information you provide at the time of contracting.

However, if you intentionally omitted some important information to determine the price of the insurance, you may have problems later.

If this omitted factor favors the occurrence of an accident, the insurer may not pay you.

This is known as “risk aggravation” and legally protects companies from refusing to pay because the contracting party tried to abuse “good faith”.

For this reason, the best thing is that you provide the correct and truthful information when hiring, that you pay what is fair, and that you analyze which is the best option for you.

Insuring your car is not an expense, but an investment to protect your assets and you know the peace of mind in an emergency.

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