Understanding What Affects Car Insurance Rates

Car Model

The age, value, and insurance group of your car all affect your insurance premium. Cars are categorised into insurance groups, based on their value, repair cost, safety, and performance. The insurance group your vehicle is in will be a determining factor in the price of your insurance.

Car Modifications

Car modifications affect the price of insurance too – for example, custom exhausts or tinted windows can raise the cost of your premiums. It’s important to let your insurer know of any modifications made, claims can be refused if this information is omitted.

On the bright side, some safe modifications such as parking sensors can actually bring the cost down.

Your Age

Younger drivers under the age of 25 will typically face higher insurance costs due to lack of experience on the roads. Insurers see them as a higher risk for accidents, which means higher insurance costs. Temporary insurance for younger drivers can be a good alternative to paying for hefty annual costs, if they don’t drive all that often. 

It’s not just younger drivers that can see higher costs though, drivers over  75 will be charged more too, as they are also considered higher-risk.

Your Location

Where you’re based also has an impact on insurance costs. Insurers look at the average number of claims in an area, and how many of these claims are fraudulent when calculating costs. 

They also consider the crime rate of an area, how many accidents happen and how busy an area is. That’s why you might find car insurance in a city is more expensive than in rural areas.

Where You Keep Your Car

It’s not just the area in which you live that affects the cost of insurance, it is also where you typically park your car. Cars that are parked on public roads rather than private garages or driveways are more likely to be damaged or stolen, which will mean higher insurance costs.

Car Sharing

Sharing a vehicle with a partner or family member who has a no-claims history can bring insurance costs down. If you are ever sharing your car with someone temporarily though, we recommend getting them to use short-term insurance cover, as it won’t affect your no-claims discount and will be cheaper than adding them to your policy. 

Do not, however, add a main driver with good experience to the vehicle fraudulently, as this could lead to criminal convictions down the line and invalidate your insurance.

Your Occupation

Car insurance occupation categories also affect how much your insurance will cost. Some jobs may be viewed as high-risk, such as occupations that involve lots of time on the road, carrying specialist equipment in the vehicle, or driving at night for example. These types of roles would increase premiums. 

On the other hand, less risky roles that don’t involve a lot of travelling won’t raise prices. 

Even the job title comes into play here so be as specific as possible rather than opting for a more general term – do not provide false information though, that will invalidate your policy.

Your Driving Habits

Your driving habits will also affect your insurance costs – if you tend to drive more than the average driver, your chances of accidents increase along with wear and tear on your car, which leads to higher insurance prices. 

It’s important to be honest about your mileage when applying for insurance. If you are seeing higher costs due to the amount of time spent on the road, black box insurance offered by some insurers can reduce the policy costs by allowing them to check you are driving responsibly.

Your Driving History

Drivers with a long list of claims on their record will have higher insurance costs, as insurers will be less willing to insure someone with a bad track record. They will also look at points on your licence, previous suspensions and convictions. 

Insurers want drivers with clean records who won’t cause them any bother, so the better your driving history is, the better the insurance cost will be!