Breaking Down the Rate: What Factors Are Used to Determine Auto Insurance Premiums?

Auto insurance premiums include a lot of risk assessment and analysis as well as cost evaluations. Mid Atlantic Insurance Financial in Laurel, MD uses all of these cost evaluations, risk assessments, and driver information to get you an insurance policy to fit your specific needs.  If you currently quoting your insurance policy, you may find yourself asking, "exactly what factors go into determining a rate premium?" 

Your Credit Score

Maintaining a good credit score is important in many aspects of your life, and car insurance is no different.  Claims reporting has shown that drivers who maintain a higher credit score file insurance claim less frequently than those who may have fair to bad credit.

Your Past Driving Record

One of the largest factors that help to determine your premium rate is your past driving record.  If you have a past history of speeding tickets or at-fault accidents you will usually be charged a higher rate as you will be considered at higher risk for a claim.  Most insurance companies use three years of driving history when determining rates.  If you have severe risk factors, such as DU’s or reckless driving, you could pay significantly higher rates.

How Much Annual Mileage You Put on Your Car

The more miles you put on your car each year, the more likely you are to end up in a motor vehicle accident.  Less time on the road means you are less likely to file a claim and your insurance company will reflect this risk in your monthly premium.

Your Age

Statistical data has shown that differing age groups are more likely than others to get into car accidents.  More mature and experienced drivers are often more likely to be better defensive drivers and react faster.  Therefore teenagers and young adults will garner the highest premium rates.  

The Kind of Car You Drive

There are three main factors insurance companies look at when it comes to the kind of car you drive.

  • The Cost of Repair and Replacement – Your insurance company will look at what the parts will cost in the event of an accident as well as replacement value if and accident results in a total loss.
  • Safety Features – Your insurance company will look at the features that can protect the driver, the car, and the passengers in the vehicle.
  • The Amount of Damage it Can Cause – Cars that have a higher chance of inflicting significant damage in an accident will typically see higher rates in their liability insurance.

Your Selected Coverage

A significant portion of your premium will be determined by the features and coverages that you choose with your policy.  Lower deductible rates, replacement value, and towing and rental reimbursement are all features that can increase your monthly premium.

If you are looking to find ways to reduce your current insurance premium, or are shopping for a new policy, contact the experienced agents at Mid Atlantic Insurance Financial in Laurel, MD today for an estimate.



Tips for Adding Equity to Your Home

You do not have to spend a lot of money to add equity to your home and increase its value. Whether you are interested in raising the price of your home to sell it or are exploring your options, it is good to know some of the easy things you can do in your home. Use these tips from Mid Atlantic Insurance Financial, serving Laurel, MD, to increase your home equity without spending a ton of money. 

  • Modernize your kitchen. Depending on what your kitchen looks like, you can give it a facelift for under $5,000 and get a return of a 3-7% increase in your home equity. You can do things like changing your cabinets, add some backsplash, change the fixtures, and even put in some new appliances. This can change the entire look of the kitchen and can provide you a great return. 
  • Paint some rooms. You do not have to repaint your entire home but you should consider repainting the rooms that have the most damage. If a paint job still looks great, you should not touch it unless you want to change the color. This can cost less than $1,000 and provide you with a return of 1-3% in equity.
  • Upgrade your curb appeal. Sometimes buyers will not even look inside a home if the exterior looks bad. Take some time to make your exterior look better and you could increase your equity by 2-5%.

Whether you are looking to sell or you are just looking for ways to increase equity for the future, these are some great ways to get started. You should also always have a great home insurance policy to ensure that your investment is always protected. Contact Mid Atlantic Insurance Financial, serving Laurel, MD, to learn more about your options and get some free quotes.