Cars that put an emphasis on passenger safety are deemed to be safe and receive high safety ratings. This is an important factor in determining auto insurance rates. The safer a vehicle is deemed, the less risk for damage. This translates in a reduced risk and liability to the insurance company and lower cost for the car owner.
Auto Insurance Company Assessment of Risk
When an auto insurance company does an assessment and pricing of risk, it takes a look at the likelihood that an accident or loss will occur. Every loss results in the auto insurance company having to pay a benefit for the insurance policy holder and reducing its assets. The pricing due to risk goes up when a car is not safe or does not provide the adequate features necessary to keep the driver and passengers from injury or death.
Vehicle Safety Features
Cars that have certain safety features such as front and passenger airbags for adults, front and side impact air bags, a construction design that absorbs the impact of a crash and distributes it throughout the vehicle; and good front and rear bumpers, have a high rate of safety. These are features that protect drivers and passengers from injury resulting from a vehicle accident. They are also the types of safety features that the crash test rating organizations look for.
Insurance Institute for Highway Safety and National Highway Traffic Safety Administration
2 organizations, the Insurance Institute for Highway Safety (IIHS) and the National Highway Traffic Safety Administration (NHTSA) provide crash test ratings for vehicles on an annual basis. The crash test rating system is a gauge used by auto insurance companies to determine the potential for loss and the payment of benefits. It is also used by auto insurance companies to determine how safe drivers and passengers will be in a resulting accident or crash.
IIHS in Scope
The IIHS is an auto insurance funded non-profit organization dedicated to providing safety and reliability information. The organization provides front and side impact safety information and evaluates such things as survival rates and loss reduction techniques employed by auto makers. The information provided by the IIHS is relied on heavily by auto insurance companies when looking at passenger safety.
Concern for Safety
The safety of drivers and passengers is a foremost concern with all auto makers. It is especially a concern of auto insurers when assessing risk and determining appropriate premium rates to charge. Cars that are designed with better safety features and that minimize the risk of harm resulting from a crash are always going to receive better insurance rates than those vehicles that are not so well built or designed. Keeping drivers and passengers safe and reducing risk helps keep auto insurance costs down for all motorists.
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