car insurance basics - why is my insurance premium so high

Car insurance basics – why is my premium so high ?
Understanding why your car insurance premium seems very high may give you the insight needed to understand the nature of the risks involved, and what you may be able to do to reduce them, and in effect reduce costs, in this case premiums as well. Insurance is simply about risk, and someone deciding what the probability of a risk is, and then charging a percentage based rate as a result, which translates into a monetary figure that you pay as a premium. In reality, in motor insurance, it is not this scientific, and rates are affected not simply by the nature of the risk, but by many commercial factors, such as competition , long term loyalty etc. If your car insurance premium seems high, first work out what is is made up of. There are several factors that affect the rating of your quote or your renewal premium. Your age, especially it falls into a high risk category can be a factor. Many people are offended by the idea they are a high risk factor, unfortunately this is a consequence of categorizing people, a necessary part of modern mass market insurance underwriting. From an insurance point of view, high risk implies either quite young, normally within the age range of sixteen/seventeen up to about twenty five or quite elderly, normally over the age of seventy or seventy five. For fairly obvious reason , both these categories of people are considered quite high risk. Young people because they can be more reckless, and elderly because they can become more doddery as time goes on. Unfortunate though these stereotypes are, they area fact of life from an insurance point of view. They can also work in your favour. If you can prove to your insurance company you are not stereotypical, then it is possible they will reduce your premiums accordingly. Also where you live will also have an affect on your rating of your car insurance. This can be about geographical location, but is also very much about urban or rural areas. Whilst you cant do much in one sens e, except move, different insurance companies will have different experiences of different parts of the country, and charge accordingly. It is worth shopping on this basis alone. The other main thing that affects your costs is the type of cover you have. There will probably be a minimum legal requirement to have some type of third party cover on your vehicle, which you may have extended to include fully comprehensive cover. Do not mess around with the third party element, get as much cover as you can. You can look at some of the extras in your fully comp, such as hire car / courtesy car cover, breakdown recovery service etc to see if you really want them. Sometimes they are automatically included and the premium adjusted upwards accordingly. Check and see what level of cover you really want and need.