Factors Considered by Insurance Companies to Assess Your Car’s Insurability

1. Factors Considered by Insurance Companies to Assess Your Car’s Insurability If you carry a bad image in the traffic rule books, it will be a bit difficult for you to improve your image and get things back on track. Traffic violations on your record creates an adverse effect on your pocket because every time you need to pay more insurance premiums than most people until you have a normal rate again. Not depositing fines on time and violating the traffic rules are the major causes of the bad image in the traffic rule books. However, this could easily be improved by setting off all the dues at once. There are some other ways to reduce your insurance premiums like buying a car with high collision prevention score and getting driving classes to improve your driving skills. This will help you qualify for the lower rate slab of the insurance premium and set a reliable driver image. Verification of car safety features is another effective tactic you can adopt to avoid high insurance premiums. It is very necessary to check if the car you are driving is safe for you as well as for the other people in the car. The more risky your vehicle will be, the more you need to pay for your car insurance. All these factors are very complex, therefore, it is very important to understand how insurance premium works. Let’s discuss the crucial factors that are considered by an insurance company to treat you as a potential client.

2. Primarily, people think their outstanding fines and the number of claims they have taken plays a vital role in deciding the insurance rates. However, except the insurance claims, there are certain other factors that also impact your insurability: Insurance History From how long you have been paying for your car insurance premiums, late payments, and if you have ever been a defaulter for non-payment by an insurance company. It is the first step that is checked before insuring your vehicle. Financial History Although, credit scoring is not used by all the insurance companies, but there are some that look for your credit score. If you have a bad credit score or have been declared defaulter in past years, it will adversely affect the policy you are willing to take. Driving Record and Claims History The number of times you have violated a traffic rule will directly affect your insurability and the cost of your car insurance. Apart from this, there are some companies that avoid offering insurance to vehicles that have a long claim history. Therefore, you need to pay high for getting your vehicle insured and for a better risk management system. Usage of Car If you’re using your car for business purpose, the premium will be higher because the car will be on the road a lot more than if it was used for the personal purpose. The more a car is on the road, the more likely an accident is to occur. Therefore, insurance companies decide the amount of premium based on the usage of the car. Insurance companies nowadays are referring to collision prevention score before insuring a vehicle. This score includes the durability of the car, crashworthiness, likelihood of being damaged, and the safety features. The higher score means the car is equipped with advanced safety measures that help the consumers to choose a safe car. It is also useful for insurance companies to reduce auto insurance risk and decide insurance premiums. Source: - https://stickerlookup.home.blog/2019/11/04/factors-considered-by-insurance-companies-to- assess-your-cars-insurability/

3. Significance of Car Safety Ratings While buying a car, along with its price and specifications, its safety features should also be considered. Every year, the National Highway Traffic Safety Administration (NHTSA) and the Insurance Institute for Highway Safety (IIHS) conduct crash tests on new vehicles and rates their performance in its 5-Star Safety Rating program, where 5 stars means the highest safety and one indicates the lowest. These set the standards for how cars are rated and analyze different criteria to create a full picture of how well a car can keep its occupants safe. NHTSA Safety Rating After a series of crash tests, the NHTSA bases its ratings on your likelihood of being injured. A vehicle with a 5-star rating going to be the safest, which means that the vehicle has scored “good” on multiple crash tests. NHTSA car safety ratings are often available on car decoration websites to help you quickly decide which cars are safest. IIHS Safety Rating The IIHS conducts more robust tests on vehicles, putting them through multiple scenarios to rate them as:

4. Poor Marginal Acceptable Good A car with good crashworthiness means it is compatible as per the safety standards and it limits injury and protects the people inside. These agencies also define which vehicle has more of the following crash avoidance technologies: Forward Collision Warning Lane Departure Warning Dynamic Brake Support (it is also known as brake assist that supplements the driver’s braking to avoid a crash) Crash Imminent Braking (it is also known as automatic emergency braking that gets activated to slow down or stop the car in case, the driver takes no action) Neither these organizations test all cars available in the market, but they test the ones people buy most – like NHTSA has set targets to test almost 43 vehicles in the 2019 model year. It has also executed verification testing of the advanced crash avoidance technology systems in 41 vehicles.

5. Both the NHTSA and IIHS crash safety ratings are considered reliable and authentic. You just need to enter a vehicle’s company, model and the year in which you want. You will find the safety rating section below in the results that will help you to make a better decision. The NHTSA states that standard safety equipment like air bags, seat belts, a tire pressure monitoring system and safety management system are some factors that you should take note of when inspecting a car. Driver assistance technology like forward collision warning, lane departure warning, rearview cameras and the automatic emergency braking are also helpful in keeping cars. Understanding how a car’s safety is determined is critical when you’re out to get one as your next vehicle. To learn which car rates highest, you can refer to these organization’s websites and get the details about the safest cars. A driver's action, or inaction, is the critical reason for an accident in 94 percent of crashes, according to a NHTSA study. Therefore, you should always look for safety features along with the specifications and its price to ensure a safe drive. Source: - https://stickerlookup.home.blog/2019/11/05/everything-you-should-know-about-car- insurance/