Thursday, October 13, 2016

Car Insurance legally



source image iconarchive.com

Here's the detail detail car insurance Yes and no. Car insurance rates are regulated by the states, but as the long u.s. companies observe state laws, they are free to charge what they wish. State laws ensure that a company charges the same rates to drivers who fit the same risk profile. Another company may charge you much less, or much more, but it, too, must offer the same rates to all drivers with pose a similar risk. Insurance companies are prohibited from using certain characteristics in setting their rates, such as race and religion. California, Hawaii and Massachusetts prohibit use of your credit information, and others don't allow companies to penalize you based on your age or your gender. All states set minimum levels of liability insurance coverage. Some require that you buy uninsured motorist coverage. Some make medical payments coverage mandatory. These financial responsibility laws ensure that drivers who inflict injuries on others have a means to pay, and those who are injured have coverage if the other driver does not. Your lenders may require that you buy comprehensive and collision coverage to protect your car from physical damage, but the states do not. How is my car insurance rate set? When you submit an application for car insurance, you are first sorted into an individualized group – say, married drivers in your ZIP code over age 25. Once your customized group has been determined, the insurance company calls up the pricing information for that group. It adjusts for any negative factors, such as recent traffic violations or a pattern of claims. It considers the value of the car you are insuring and the frequency of claims its owners file. Finally, any discounts you qualify for are subtracted from the price, and your quote is returned. The math is done behind the scenes according to an algorithm that weighs each risk factor – each bit of information you or your agent enters into the system. If you decide to buy a policy, your quote information goes through a verification process called underwriting. The company pulls your driving record and those of anyone else listed on the policy.


 source image Confused.com

     It looks up your claims history. It matches your vehicle identification number to ensure it has the correct model. If the company finds an error, it has the right, within a certain period of time, to offer you a new rate or to cancel the policy. Why do insurance companies have such different rates? Each company has many different groupings of basic rate and can set different prices for those groups, ' new basing its estimate of risk on the number and cost of claims that the group has filed in the past. Then the company applies its own surcharges and discounts based on factors specific to a particular driver. That means car insurance rates can vary considerably from one company to the next. An Insurance.com survey of data from six major insurance companies in every U.S. ZIP code found the average difference between the cheapest and least expensive quotes for the same driver and car (a 40-year-old uk homeowner with a clean record buying full coverage on a new Honda Accord with a $ 500 deductible and 100/300/50 liability limits) was $ 1.032. The big gap between companies is why the first step toward cheaper car insurance is comparing quotes, then looking at discounts, deductibles and coverage changes. In high-cost states, such as Michigan, California and Louisiana, the difference can be much greater. In low-cost states such as Maine or Ohio, the differences tend to be smaller. What affects the auto insurance rate quotes I receive? Depending on state laws, which can restrict the type of information an insurance company may use, these factors will usually affect your rates: Who you are: Age, gender, marital status, ZIP code, number of years you've been licensed, homeownership, occupation, education and even grades Your record: Accidents, traffic violations, insurance history, credit history, past claims of all types What and how you drive: Owned or financed, current value, annual mileage, claims record for all owners of that model, anti-theft devices and safety features, whether you use the car for business How much coverage you want: Liability (from minimum levels up to $ 500.000 or more), whether or not you buy comprehensive and collision (both of which carry a deductible that influences their final cost), medical payments, uninsured motorist, or extras such as rental reimbursement or towing. Which factors affect car insurance rates most? While each car insurance company decides on its own how heavily to weigh a rating factor, clear patterns are evident. For most drivers, these factors tend to influence rates most: Your ZIP code. Even if you have never filed a claim, your rate can increase dramatically simply by moving from one ZIP code to another. Your age. Drivers with less than 10 years of experience pay more. The less experience you have, the worse the penalty. Brand-new drivers can pay an additional surcharge on top of