When calculating rates car insurance companies use car insurance groups or categories to determine rates for particular age groups or demographic groups of drivers. The car insurance group an insurance company places you in can drastically affect you will pay for car insurance.
Car Insurance Age Groups
One of the biggest factors that will affect your car insurance rates will be the insurance rates group that your car insurance company places you in. For example, if you are a teenage driver or driver under the age of 25, you will always pay much higher premium rates than drivers in other age groups. After you reach the age of 25, your insurance premiums will steadily decline until you are aged 56 or so. At that time, many companies will start to slightly increase rates. However, some companies may avoid increasing rates until you are actually over the age of 65.
Gender Grouping
Almost all statistics and studies show that women are usually much safer drivers than men. So, insurance companies group women drivers in a lower risk category than men drivers. So, women will usually always enjoy a discount on their car insurance premium. In fact, most car insurance companies offer women a 10% discount over rates for the same coverage as men.
Financial Status Grouping
Insurance companies also consider the financial status of a driver as well. For example, many insurance companies consider more affluent drivers with high credit scores and ratings to be lower risk drivers than drivers with the poor credit scores. In fact, many studies bear out the fact that people with good credit make far fewer car insurance claims than people with lower incomes or bad credit scores.
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