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The Costs of Car Insurance Premiums

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An insurance company takes great care and time to decide when and if they should pay out for a customer’s claim. In the unfortunate instance that you have a car accident and are in need of car insurance pay out, your chosen firm will assess several factors before deciding how much and if at all they will pay out:

  • The more extensive the insurance cover, the more the policy will cost you – this is why comprehensive cover is more expensive than third party insurance.
  • The type of vehicle such as a truck, small sporty car or family van will have an influence on the insurance premiums. Some vehicles may cost more to repair than others or some vehicles are at higher risk for being stolen or broken into. The general safety of a car also plays a big part. In addition aspects such as airbags may push the premiums a bit higher because of the cost involved in replacing them.
  • The age of the vehicle will have a definite influence. This is because an older vehicle may cost less to replace, but it may be difficult to get parts for the vehicle and in general it will be more at risk of other faults and failures. If you buy a secondhand vehicle you must insist on an AA test certificate to help you get lower rates.
  • Sporty vehicles will cost a bit more because of the power and speed associated with them. Drivers are generally more likely to be younger and more reckless.
  • The costs of your policy will also be affected by whether your car is parked in a locked garage at night.
  • The premium may be made less if the vehicle is fitted with tracking devices and other safety extras.
  • Important factors are the age of the driver, gender, driving experience, driving record, and when the person received their license. Older, more experienced drivers will usually get a small discount on premiums.
  • The vehicle owner must confirm what the policy says about nominated drivers your claims can be very quickly denied if someone other than a nominated driver was driving at the time of the accident.
  • It generally costs more to insure your car separately (in a “stand-alone” policy) than it does to include it in your household contents insurance policy.
  • As with all insurance, the person who takes out the insurance may have to pay an excess, which is the first amount to be paid with any claim. Even if you were not at fault in an accident, you may have to pay the excess.
  • Several insurance companies will allow you to negotiate the value of the excess you pay, and this also affects the cost of the premiums you pay. The higher the excess, the lower the premiums, and vice versa.

 

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