If you are in search of a new car, you are probably very careful about examining performance, safety, cargo spaces and more. You also compare prices and try to lower your monthly costs as far as possible by finding cheap car loans.
Maybe you are less careful about looking at the size of the vehicle tax? And do you even think about the cost of the insurance premium for your new car? Car insurance can make up a large part of the cost of owning a car, and it is important to take this into account.
Factors that determine the size of the premium
The insurance companies’ task is to manage risk. When you take out a car insurance, you in practice give the insurance company the task of managing the risk that your car owner poses (collision, theft and more). To manage the risk and give you a price (premium) for this service, the insurance company does an analysis of a number of factors. Below you can read more about the most important factors.
Age is a very important parameter for insurance companies and the basic principle is that younger people can pay a higher premium than older people can do. There are two reasons for this. One is that younger people have less experience of driving a car overall. The second is that young people statistically take greater risks in their driving. For many of the factors that determine the premium, you as a car owner can influence the size yourself, but the age factor is the same for everyone.
Car performance and value
A more expensive car costs more to replace if it is stolen. It also costs more to repair. If it also has high performance, the insurance companies expect that it will also run fast. In short, for a more expensive / faster / more theft-demanding car, you have to pay more in insurance premiums. A cheaper car with a badge-less brand and an engine with few horsepower instead gives relatively low premiums.
What your accommodation looks like
Accommodation in a villa with its own garage in a medium-sized city – this is the recipe for low risk according to the insurance companies. Accommodation in rental with parking on the street is instead the opposite. It is above all the risk of collision and parking damage that is central.
The geographical must also be mentioned in this context. The insurance companies have statistics on insurance matters at a very detailed geographical level, and some areas simply stand out positively or negatively. If crime is high in your geographical area, you can expect your premium to be a little higher.
Miles and use during the day
For a car primarily intended for commuting, the premium is normally a little higher compared to a car used mainly outside of office hours. The principle is that a car used in the morning and afternoon runs the greater risk of being involved in an accident due to the more extensive traffic.
The factor mileage per year is based on the same principle. The more miles you drive, the greater the risk of an accident. It does not matter how experienced car drivers you are and on which roads you drive – it is the distance that is the focus.
How you have previously driven your cars is another factor that the insurance companies expect. It is then about both the number of damage events and what they are about. The longer the period without damage events (and dots on the driver’s license), the lower the premium you can be offered.
You can determine the size of the deductible yourself and by raising it you can lower your premiums to a large extent. The deductible is the amount you will be liable for in repair, support and so on. The higher the deductible, the less the insurance company must pay out compensation.