Professionals in the insurance industry know that auto insurance rates vary from vehicle to vehicle. For non-professionals, the factors determining the different rates used in a car may not be entirely clear.

For example, most car owners do not know that changing coverage from one insurance company to another may mean that their insurance rates may change. Before going into practical details of this topic, this article should emphasize the importance of auto insurance.

As crisis managers easily say, taking out an insurance cover is one of the surest ways a car owner can remove or reduce the risks associated with car ownership.

The factors that influence one’s car insurance rates can be summarized in ten summary points. First, the amount of deductible fees that one is willing to pay each month. Second, the safety components contained in the vehicle (such as seat belts, anti-theft systems, anti-lock brakes, etc.). Third, the car owner’s credit rating is a major consideration for many insurance companies. It is seen as responsible and trustworthy, and therefore is likely to be “rewarded” with lower insurance rates.

Fourth, insurance companies consider the number of vehicles one owns before deciding on car insurance rates. The more cars one owns, the lower the rates that he will likely obtain, especially if he chooses to purchase its cover from the same insurance company. However, prices may be affected if different drivers deal with cars. Insurance companies assume that a vehicle without a fixed driver is exposed to high levels of risk.

Fifth, car insurance rates vary according to the age of the owners. For example, owners of cars under the age of 25 are likely to pay very high rates compared to owners in the “most mature” age group. The assumption that is applied by insurance companies is that the younger the owner, the more likely he or she will be involved in auto-related activities such as high-speed driving, or night driving. As such, insurance companies argue that the likelihood of the younger owner becoming a victim of car theft, or getting involved in accidents is higher compared to the older owner.

The sixth consideration relates to the demographic factors of the car owner such as education, occupation or marital status when determining the rates. A person’s demographics are said to provide a reflection of the extent of a person’s responsibility.