Territorial Rating Explained by Online Auto Insurance
In a new FAQ, the writers at OnlineAutoInsurance.com explain how where drivers live can affect their car insurance prices.
Dallas, TX, February 07, 2011 --(PR.com)-- When it comes to auto insurance, a number of unsuspected factors can have an impact on the average consumer’s cost of coverage. Gender, marital status, smoking habits and other factors all can affect the price of a policy. The latest FAQ from OnlineAutoInsurance.com explores another commonly used factor: address.
Insurance shoppers going online to generate quotes and conduct a car insurance comparison will usually find that they are prompted to input information about where they live. Although some may be hesitant to give this info, thinking that it will only lead to junk mail, this is actually a necessary factor in estimating how much top coverage providers will end up charging for a policy.
Location is important at both the state and the regional level.
At the state level, it is important because each has its own minimum requirements for how much protection resident auto owners must carry. Residents in Ohio, for instance, must carry a total amount of liability coverage that is only about a quarter of the amount that residents in Maine are required to carry. The more coverage that is purchased, the more that coverage generally costs. The increase in price that comes with raising liability limits is usually pretty low, though. Also, insurers will look at claims statistics from across the state in order to assess the base rate that needs to be charged.
At the regional level, local claim and theft statistics can reflect risk factors that an insurer will use to help set premiums. This is known as “territorial rating,” and car insurers across the country use the practice. If the drivers within a certain territory show a tendency to file claims that are much more expensive, or if they do so at a higher rate, other drivers from within that territory will usually be considered by a coverage provider to be a higher risk to insure. According to one authority in the industry, the area in which a policyholder lives in one of the most accurate predictors of risk.
Source: http://www.cga.ct.gov/2006/rpt/2006-R-0542.htm
To learn more about this and other insurance topics, readers can go to http://www.onlineautoinsurance.com/compare/ where visitors will find informative resource pages and a free-to-use quote-comparison generator that can help consumers quickly evaluate prices for a policy. To access the full FAQ, click on the “Questions” link at the top of any page on the site.
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Insurance shoppers going online to generate quotes and conduct a car insurance comparison will usually find that they are prompted to input information about where they live. Although some may be hesitant to give this info, thinking that it will only lead to junk mail, this is actually a necessary factor in estimating how much top coverage providers will end up charging for a policy.
Location is important at both the state and the regional level.
At the state level, it is important because each has its own minimum requirements for how much protection resident auto owners must carry. Residents in Ohio, for instance, must carry a total amount of liability coverage that is only about a quarter of the amount that residents in Maine are required to carry. The more coverage that is purchased, the more that coverage generally costs. The increase in price that comes with raising liability limits is usually pretty low, though. Also, insurers will look at claims statistics from across the state in order to assess the base rate that needs to be charged.
At the regional level, local claim and theft statistics can reflect risk factors that an insurer will use to help set premiums. This is known as “territorial rating,” and car insurers across the country use the practice. If the drivers within a certain territory show a tendency to file claims that are much more expensive, or if they do so at a higher rate, other drivers from within that territory will usually be considered by a coverage provider to be a higher risk to insure. According to one authority in the industry, the area in which a policyholder lives in one of the most accurate predictors of risk.
Source: http://www.cga.ct.gov/2006/rpt/2006-R-0542.htm
To learn more about this and other insurance topics, readers can go to http://www.onlineautoinsurance.com/compare/ where visitors will find informative resource pages and a free-to-use quote-comparison generator that can help consumers quickly evaluate prices for a policy. To access the full FAQ, click on the “Questions” link at the top of any page on the site.
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Contact
Online Auto Insurance
Benjamin Zitney
909-784-2475
http://www.onlineautoinsurance.com/
Benjamin Zitney
909-784-2475
http://www.onlineautoinsurance.com/
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