Choosing the correct automobile insurance company can save you hundreds of dollars per year.
This is due to the fact that each insurance company will calculate their rates in different ways.
Some companies may consider you a riskier proposition to insure than others which means some will charge you more than others.
The reason that there is such a variance in pricing in the car insurance industry is that there is no set formula when it comes to deciding how much an insurance company will charge.
In most states there are limits to what they can charge for a policy, but other than that the companies are pretty much left to their own devices when it comes to setting their rates.
Every major auto insurer uses a different statistical method in order to figure a quote for a prospective customer.
They have basically accumulated data from auto accidents over the years to develop a model that will indicate which type of drivers are more likely to be involved in an accident.
This statistical data is then used to formulate the quotes.
An example of how this is used is that young male drivers are always charged more for a policy than any other group.
This is because it has been statistically proven over the years that these drivers are far more likely to be involved in an accident than any other group.
This can seem unfair for new drivers who are especially cautious or talented, but the statistics are simply not on their side.
The only way these drivers can lower their monthly premiums is to show the insurance companies that they are a statistical anomaly.
They can do this by staying accident free for a number of years.
The other thing that can be done to lower your monthly premium is to shop around for a new automobile insurance company online.
Buying your next policy online can save you hundreds of dollars per year and it is one of the only ways to fight the statistical category you fit into.