Think insurance companies ask a lot of questions when you ask for a car insurance quote? Well there’s a reason: to give you the coverage that’s right for you at the best possible price. To do that, we need to understand what we’re getting into—the risk we’d be taking by insuring you. And the only way to do that is to ask (the right) questions.
Those questions are about four big factors that affect your premiums: you, your driving experience, your vehicle, and the coverage you want. Let’s take a look.
1. Driver age and gender
Your age and gender both factor into your premium. Women generally pay less than young men, since male drivers under 25 have been found statistically to cause more accidents. On the other hand, insurers offer discounts to students. At Promutuel Insurance for instance, we have a discount on collision coverage for full-time CEGEP and university students under 24.
2. Main place of use
Fend-benders and vehicle theft are more likely in big cities, which is reflected in what you pay for car insurance. Indeed, crime rates and other factors can vary significantly from one part of the province to the next. But there are ways to counteract high crime rates too, such as getting an antitheft system if you don’t have one already.
3. Vehicle use
Is your vehicle used for business or just personal purposes? Do you drive long distances back and forth to work? How many kilometres do you put on your vehicle in a year? Do other people sometimes use your vehicle and if so, what are their driver profiles? All these questions relate to your vehicle use, which has an impact on your premiums.
4. Credit rating
That’s right—studies have shown that, for some reason, a driver with a good credit rating is also a lower insurance risk. So it’s a good idea to keep an eye on your credit before shopping for car insurance. A solid credit file can get you a better rate.
5. Your driving record and claims file
How many years have you had your driver’s licence? Have you had any at-fault accidents in recent years? Do you have demerit points on your record? Your driving experience figures heavily in risk assessment and consequently in your premium. Careful driving isn’t just safer—it saves you money!
6. Vehicle make and model
The make and model of the vehicle are also factored into your premiums. Risk potential varies from vehicle to vehicle. All cars aren’t created equal and they don’t all have the same repair costs. Your chances of getting a lower rate are better with a brand-new vehicle than with an older model or a poorly maintained vehicle. The risk of theft is also higher for certain sports-car models and other high-value vehicles.
There are reliable sources that list models according to the cost of insuring them. You might want to check them out before you pick a new vehicle and the options to go with it.
7. The coverage you choose
Naturally, what you’re covered for will influence the cost of your insurance. Take the time to figure out what you really need and get the right coverage for your circumstances. Is your vehicle new, leased, used? Is collision coverage worth it in your case? Bear in mind that the only thing you legally have to be covered for is civil liability.
There’s also supplementary coverage—fire, theft, vandalism, glass, or comprehensive accident. You can choose the “all perils” option to get all the available coverage, or get coverage for damage to your vehicle resulting from an at-fault accident. If it’s new car, there’s also a replacement value endorsement you can add so you don’t have to make up for vehicle depreciation if something happens.
Well that pretty much covers the big questions affecting what you pay for car insurance. Most Québec damage insurers ask roughly the same ones. This article has also shown that there’s some wiggle room and that there are things you can do to get a better price. Just make sure you have the coverage you need.
Don’t be shy about asking your representative about all the types of coverage available as well as discounts. And compare quotes from different insurers!