Since car insurance has become such an important requirement these days, when the traffic on roads has multiplied so much, it is necessary to know what determines the car insurance rate of different companies. The rates determined by a single company are the variant of tiers used by it for this purpose. The rate tiers may differ from simple to complex.
The most prevalent tier system is the three tier system which distinguishes drivers as preferred, standard and below standard. Companies may have a higher number of tier systems also. The drivers rated in the lower risk category of such tiers will get lower insurance rates. But, a company with the higher number of tiers will have more distinctions of rates which increases the chances of a person getting cheap car insurance quotes [http://www.autoquotenow.com].
The criterion used by a company for the risk assessment of a driver are his driving record, the number of accidents he was a part of, for what time he had an insurance policy and how many insurance claims he filed in the recent past. The number of miles regularly driven by a driver also affects his risk score. The other apparent factors affecting the risk liability of a driver before an insurance company are his age, gender, his state of residence, his martial status and his credit rating. The risk assessment of a car driver is affected by various factors like his education, occupation, smoking and drinking habits.
Mobile phone users are in the higher risk category of such insurance policies. The type of car, along with its year of manufacture and the manufacturer are also determinants of the car insurance rate.
All the car insurance companies keep a database of the various insurance policies issued by them so far. So, they can make an easy analysis of the various risk factors having an impact on the average insurance payouts and determine various risk categories on the basis of the same.
Predictive modelling is applied by insurance companies to find the risk category to which a car bearer belongs. Every insured's chances of being part of an insurance policy are determined from his past history of insurance policies. The various predictive modelling tools applied by different companies for arriving at risk assessment categories are Cramer's Model, neural network and regression.
The car insurance rate of a smaller company are lesser because it does not spend much on overheads and advertising. The costs are also less for larger insurance companies that operate at a large scale and hence can offer lower rates to their policy takers.
The most prevalent tier system is the three tier system which distinguishes drivers as preferred, standard and below standard. Companies may have a higher number of tier systems also. The drivers rated in the lower risk category of such tiers will get lower insurance rates. But, a company with the higher number of tiers will have more distinctions of rates which increases the chances of a person getting cheap car insurance quotes [http://www.autoquotenow.com].
The criterion used by a company for the risk assessment of a driver are his driving record, the number of accidents he was a part of, for what time he had an insurance policy and how many insurance claims he filed in the recent past. The number of miles regularly driven by a driver also affects his risk score. The other apparent factors affecting the risk liability of a driver before an insurance company are his age, gender, his state of residence, his martial status and his credit rating. The risk assessment of a car driver is affected by various factors like his education, occupation, smoking and drinking habits.
Mobile phone users are in the higher risk category of such insurance policies. The type of car, along with its year of manufacture and the manufacturer are also determinants of the car insurance rate.
All the car insurance companies keep a database of the various insurance policies issued by them so far. So, they can make an easy analysis of the various risk factors having an impact on the average insurance payouts and determine various risk categories on the basis of the same.
Predictive modelling is applied by insurance companies to find the risk category to which a car bearer belongs. Every insured's chances of being part of an insurance policy are determined from his past history of insurance policies. The various predictive modelling tools applied by different companies for arriving at risk assessment categories are Cramer's Model, neural network and regression.
The car insurance rate of a smaller company are lesser because it does not spend much on overheads and advertising. The costs are also less for larger insurance companies that operate at a large scale and hence can offer lower rates to their policy takers.
SHARE
