How can life events impact your car insurance

Cheap Car Insurance | April 15, 2016 | Leave a comment
How can life events impact your car insurance

When your life changes, your car insurance needs as well as rates might also change. Understanding how main life events impact your car insurance rate can help you warrant you have the right auto insurance coverage for your current situation.

So, what are life events? Basically, a life event is a main life change creating a new financial consideration or situation.

Life events often include, yet not are limited to:

  • Having a kid
  • Purchasing a car
  • Getting divorced/married
  • Purchasing a house

Now, you may wonder how life events could impact your auto insurance.

6 Common Life Events Impacting Car Insurance

  1. Change In Marital Status

A few of the biggest life changes are:

  • Separating from the life partner
  • Getting married
  • Losing a spouse due to death

When the number of drivers in your house increases like getting married, then your insurance rates will thereby increase. Nonetheless, a lot of people find that their car insurance rates as a couple tend to be lower than their combined insurance rates as two separate people.

On the other hand, when the number of the drivers decreases, your car insurance premiums might drop. However, do not expect that the rate could be reduced in half, because you will no longer have the discount of marriage.

  1. Having A Child

Having a baby might really help you decrease your auto insurance rates. Those car insurance companies have discovered that parents with small children seem to drive much more attentively due to their precious cargo. Besides, a large number of parents with babies on board select to use a safer, larger vehicle. Upgrading to such a bigger, safer car usually lowers your premium.

  1. Moving To A New Place

Another life event impacting your car insurance is moving to a new house. To be honest, it might or might not impact the rate of your car insurance. If you move to a place with lower population, then the risk you have an accident might reduce, thereby leaving you with a lower rate of car insurance.

Conversely, in case you move to a population-heavy, urban location, you may expect your car insurance rate to increase as a consequence.

If you purchase a new home, you might be eligible for the multi-policy discount by combining the car insurance policy with the homeowner’s insurance.

  1. Adding A Young Driver

Young drivers, more specifically teenage drivers are statistically more likely to go with unsafe behaviors and involved accidents than those older ones. Due to this, young drivers come with a higher risk of accidents, presenting higher risk to those auto insurance companies. In turn, they will charge young drivers higher premiums.

Read more: 3 factors car insurance companies use when calculating risk

  1. Purchasing / Selling A Vehicle

The vehicles on your insurance policy impact directly your insurance cost. The more vehicles you have insured by an insurance company, the less you pay per vehicle, because you will likely get a discount on multi vehicles. Nonetheless, with more vehicles, you tend to pay more altogether.

If you purchase a new vehicle, its specific features will affect how much it will cost to insure. For instance, high-performance cars, SUV and luxury cars will have higher premium than other types. Nevertheless, it is worth noting that if your car is equipped with some specific safety equipment like passenger-side airbags, passive restraint, then you may get a discounted insurance rate.

If you get sell your car, your premium might drop, even when your per-car rate increases a little bit.

  1. Having A New Job

One of the common factors impacting your auto insurance rate is your commute. The father you go to your workplace, the more you pay.

In case your workplace is close to your home, you will thereby pay less. If your mileage has decreased, warrant that you update your car insurance agent to guarantee that the change is reflected in your insurance rates.

Shopping For Car Insurance After A Life Event

When a major life event happens, shopping around for auto insurance could help you obtain the most economic car insurance possible.

Each car insurance companies offer a bit different formula for the way they determine your insurance rates. Thus, you had better find the one with competitive, reasonable rates in order to help get the most suitable insurance policy according to your life changes.

How can life events impact your car insurance
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