Wednesday, December 10, 2014

Risky insurance claim and much more


If you’re labeled a “high risk” driver, your auto insurance premium is probably more expensive than other drivers’, since the insurer uses your profile and your driving history as an indicator of safe and responsible driving — it’s based on their determining your risk for getting into a possible accident or collision. The higher the possibility that you’ll incur costs to them through damaged property and medical bills, the more pricey your premium will be.
There are three main factors that insurance companies look at to decide what kind of driver you are:
●    Driving History
●    Profile
●    Credit History
Although, there’s nothing you can do to change the past, you can take steps to get out of the “high risk” category. The most important thing you can do is to prove that you can be a responsible driver by maintaining a “clean record” for an extended period of time. This means that you must drive carefully and avoid: being involved in any type of collision or accident, not just those that you’re at fault, incurring any speeding tickets, and violating traffic laws. Since most car insurance policies renew every 6 months or so, the more time that passes without an incident will benefit you and help make the case that you’re a less risky driver. Conversely, every ticket or traffic violation will indicate higher chances that you may be driving recklessly and could get into an accident. Typically, a driver with no points caused by accidents or tickets is considered good or low risk.
In terms of your profile, there may not be anything you can do, since it’s based on your age, sex, location, distance from work, etc. Based on statistics, car insurance companies favor these groups as safer and more low risk:
●    Women over Men
●    Adults over Teenagers
●    Rural residents over Urban residents
●    Parents and those who are Married over most Single drivers
So even if you have a perfect driving record, there may be existing characteristics that may make you a “high risk” driver, such as if you are under 25 years of age, are a new driver, are a male, are a student, have a history of filing claims, or have bad credit.  And although bad credit isn’t directly related to your driving habits, there are studies that show a correlation between poor credit and an increased number of insurance claims, meaning it may cost more to provide coverage for all those claims. However, as with many other things, time can help; so can improving your credit history by making those bill payments on time!
There are also some changes you can make on your car insurance policy to help lower your insurance costs. You can choose a higher deductible, which will directly affect your pricing, since this means you’re opting for higher out-of-pocket costs before your insurance coverage kicks in. You may also want to consider dropping your collision and comprehensive coverage to even further cut your premium costs.  You can even switch to an older car or a more “safe” car, which insurers will take into account and factor in as part of your driving profile.
Lastly, you can also shop around and compare car insurance quotes! There are even insurance companies specializing in high risk drivers so they may be able to give you more competitive pricing if you take the time to get a few price quotes.
Although being a “high risk” driver can mean that you’ll be hit with higher pricing now, with some time and good habits you can get on your insurer’s good side!

Things remember while doing Insurance operation

When you go through major changes in your life, it can indirectly affect you in ways you may not be aware of. Auto insurance companies support you in your time of need, but they leave the responsibility to you to be proactive in discovering discounts that may be available to you, based on life changes. They won’t tell you when it’s time to change your insurance policy, so here are a few things you may not know.
1.    Your Credit Score. If you have increased or decreased your credit score significantly, compared to when you first got the car insurance quote,  your insurer may change your premium based on your credit score – good credit is associated with being responsible and a responsible driver. If your insurer doesn’t lower your premium, shop around for an insurance company that will consider your good credit score.
2.    No More Commuting to Work. If you recently lost a job either by getting laid off or being fired, you have the opportunity to lower your premium, since you won’t be commuting to work during this time. If you work at home, you can also talk to your insurer to get your premium adjusted for less mileage driven annually. Again, shop around for a good car insurance quote that considers low driving mileage in your premium.
3.    New Home. When you purchase a home, you will need to buy homeowners insurance too. This is the time you should look for auto insurance and home insurance packages that give you multiple insured discounts. Most insurance companies will be able to combine the two for you for a rate much lower than if you bought them separately at two different insurance companies.
4.    New Drivers Added. It is most definitely a great time to shop around for a new car insurance quote when your children get their license and you have to start sharing the car with them. New drivers do increase the premium significantly, so shopping around will help you get the best rate for this life-changing period.
On the other hand, there are times when you will need to shop around for a new insurance quote even if you aren’t going through significant life changes. Below are 3 things to keep in mind about your auto insurance premium and how to maintain an affordable premium to cover everything you need.
1.    Premiums go up. Often times, a carrier will see that you are loyal and don’t shop around, so they take that opportunity to increase your premium. Let them know that you are shopping around and if you do get a better car insurance quote from somewhere else, see if your current insurer can match that quote or do better.
2.    You’re with the company for three years. It’s a general rule of thumb to get an insurance quote every 3 years, as there may be changes that will give you a better rate. For instance, your credit score increased or your accident that happened 5 years ago won’t significantly raise your premium anymore.
3.    Not getting what you paid for. When the time comes to collect an insurance claim and your insurer doesn’t give you what believe is good service, it is definitely time to look for a new company.
Don’t be afraid to shop around, your insurance company wants to keep you as a customer; if you decide to leave, they’ll offer what they can to keep you with them. Shop around to see what service is best for your driving habits.
What’s made you shop for a new company? Feel free to share your thoughts and experiences in the comments section below.
Posted by Money In th