How Auto Rates Work

Auto rates vary greatly from company to company — largely because different companies like to insure different risks. Because the rates depend on each person's own situation, no single company can claim to have the best rate in all situations.

When shopping for automobile insurance, consider the product you are purchasing, the price you are charged, the discounts that apply and the service and other benefits you can expect to receive from your insurance provider.

Many factors are taken into account when establishing the yearly premium you pay for automobile insurance. Generally, these can be categorized as follows:

The insured drivers and their driving record

Insurance companies can fill books with the data they have collected on drivers — and their driving habits. Experts called actuaries examine this data and look for trends that can be used to determine rates, so that people who are less likely to incur an insurance claim receive credit, and those who are statistically more likely to possibly incur a loss pay higher rates. While some motorists may not always agree with these rates, the accuracy of the actuaries is quite uncanny. Some of these factors include:

• Age of the drivers
• Marital status
• Prior claims
• Gender
• Type of driver education
• Experience with speeding tickets or other moving violations
• Where they live
• Who else in the household is an occasional driver

The insured vehicles and their use

The type of auto you are insuring has a direct impact on the premium, as more expensive vehicles are more expensive to repair or replace. Similarly, some vehicles might be more prone to theft than others. Also, the more you drive, the more likely that something might happen to your vehicle. Specific factors include:

• The make, model and year of the vehicle
• If you drive the car to work, the distance you travel each day
• If you drive the vehicle for business
• The distance you drive in a year

The insurance policy — additional coverages, deductibles and discounts

There are many optional coverages that might apply to you — and you can decide to purchase them or not.

We strongly encourage you to speak to us to review the coverages you may require to protect your car, yourself and your family. Some of the more common coverages include:

• All Perils
• Collision
• Comprehensive
• Specified Perils
• Loss of Use - Transportation Replacement (S.E.F. # 20)
• Family Protection (S.E.F. # 44)
• Removing Depreciation Deduction (S.E.F # 43R)
• Liability for Damage to Non-owned Automobile (S.E.F #27)

Deductibles

This is the portion of a claim that you are responsible for. You can select different deductibles for different sections of your policy. Typically, the higher the deductible, the lower your premium. The most common coverage areas with deductibles are:

• All Perils
• Collision
• Comprehensive
• Specified Perils

These Range from $250 to $5,000 (in most cases).

Underwriters look at many factors, rules and guidelines to determine the
rate you will pay for your auto insurance, and they also apply deductibles
and discounts.

Whatever you decide to do, be sure to get a quote from TW Insurance Brokers. Request a quote online or call us toll-free at 1.800.272.5688.

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