The factors used by auto insurance to determine premium rates can be baffling to the average motorist. For example, you have probably heard that your location (where you live) is one of these factors. On the surface, it may seem like your neighborhood should have nothing to do with your car insurance premiums. However, it may make much more sense if you consider that your neighborhood determines the following factors:
How good are the roads in your area? For example, are there lots of potholes? This is where you drive the most, so if the road conditions are bad, then it increases the risk of car damage or even accidents. It is not just about potholes; other issues of significance include:
Insurers are always on the lookout for anything that increases the risk of accidents, thefts or damage. A high population density increases the number of cars on the roads, which increases the probability of collisions. It also leads to a heightened risk of pedestrian accidents and thefts, both of which your insurance company covers.
Climate and Weather
Weather elements have a great influence on the number and nature of accidents. For example, the road gets slippery when wet, which means cars become more difficult to handle and more likely to crash. Therefore, if your area experience lots of rainfall, snowfall, and flooding, then you may have to pay more for your insurance coverage than if you lived in an area with a more agreeable weather.
Efficient Safety Services
Lastly, living in a neighborhood with efficient safety and rescue services may also help ease your rates. Safety and rescue services include road assistance, traffic police, and emergency responders, among others. Your rates may be higher if your neighborhood lacks such services, or they are known for their laxity.
Number of Claims
Insurance rates for an area with more claims are likely to be higher compared to neighborhoods with lower claims. Living in a high-claim area increases your risk to the insurance company. It might not even matter what is causing the high number of claims.
If you are looking for a home, then it might be wise to consider these factors and speak with your auto insurance agent. Apart from easing your auto insurance rates, they are also things that determine your quality of life.