Questions/Factors Insurers May Ask/Consider Before They Offer You A Policy:

1. Driving Record ­ On the application, you will be asked about your previous driving record. Insurers will ask about accidents and traffic violations for any driver covered by the policy for the preceding 3­5 years. Drivers with previous violations or "at fault" accidents are considered to be a higher risk and are charged a higher rate. 2. Territory ­ The claims experience in your geographical area will also affect your rates. Applications include a question that asks for the address where the vehicle will be garaged. From this information, insurers assign you to a territory whose rate is based on historical experience for that territory. Generally, more claims are made from urban areas with tendencies of busy traffic, thefts, vandalism, etc., than from rural areas. 3. Gender and Age ­ Statistically, males have more accidents than females. For this reason, men may tend to pay more for insurance than women. A small number of states have prohibited insurers from using gender as a factor in underwriting; however, Nevada allows this type of rating. Insurers also have statistics that show a higher number of claims for some age groups than for others. For these reasons, young men tend to pay more for insurance than young women, and a person under 25 will pay more for insurance than a person of age 35. 4. Marital Status ­ Statistics show a lower rate of auto insurance claims among married policyholders than unmarried policyholders. 5. Prior Insurance Coverage ­ Insurers may ask if you have previously had insurance coverage because they want to know if you have been canceled for non­payment of premiums or other reasons. If you have had insurance, your prior company can tell the new insurer about your claims history. 6. Vehicle Use ­ You will be asked on the application how often and how far you drive the vehicle that you want to insure. Greater use will generally result in higher premiums due to the increased exposure to risk. 7. Make and Model of Vehicle ­ The type of car you drive will directly affect the cost of comprehensive and collision coverage. A make or model of car that has a high number of claims or higher claims cost will be charged a higher premium. The single greatest influence on the rating process is claim frequency. This does not mean how many times you specifically have made an insurance claim; although that will have an additional effect. Claim frequency measures how often an insured event occurs within a group relative to the number of policies contained in that group. Persons sharing characteristics with a high­claims group will be charged more for insurance coverage. At the same time, persons who share characteristics with low claims classes will be charged lower rates. In addition, insurance companies offer discounts to individuals that exhibit certain characteristics. However, the greatest controllable factor is your driving record. A person with a clean driving record will pay less than other drivers.

The information on this page is meant to provide a general overview of the law. The laws in your state and/or city may deviate significantly from those described here. If you have specific questions related to your situation you should speak with a local attorney.

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