Thursday, 19 March 2009

How Are New Car Insurance Rates Determined?




It is law that your vehicle be insured. For new car insurance, there are many factors that will determine the insurance premiums you must pay. The type of car you drive will be of most importance. As is your driving history and the amount of options you chose on your insurance. A good way to have a better idea of what range your premiums might be in is to understand what car insurance group your new car belongs to. There are at least 20 different car insurance groups with high performance cars on the high side of the 20 groups.

These are the factors considered for new cars when defining which group they belong to:

• New car values

Price is important especially for cost of replacement and repair.

• Damage and parts costs

The likelihood of damage and cost of parts for repair. The lower the costs, the better chance of a lower group rating.

• Repair costs and times

The longer the repair time, the higher the cost. Higher cost equals higher group rating.

• Car performance

Statistics show that high acceleration and top speed cars result in more frequent insurance claims.

• Body shells and accident repairs

How available is the basic frame of the car? This is important for certain damage repairs.

• Car security

Good security features help reduce the risk of the car being stolen or vandalized. This can help reduce insurance claims cost and therefore put the car in a lower group.

After considering all of these factors that will influence the rate of your new car insurance premiums, the best thing to do is a little comparison shopping online. Most major car insurance companies will allow you to get a free quote online with no obligation to buy. This allows you to easily compare prices between different car insurance companies. Prices can vary by hundreds of dollars, so it is worth the small effort it takes to do a little internet surfing.



Car Insurance

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