How does the insurance company determine my premium?

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What information do insurance companies need to calculate rates?

When drivers apply for a quote, an insurance company typically needs basic information before it can produce an accurate rate. If you want to know how to calculate premiums in general, insurance companies usually need to know:

• Your age
• When you got your license
• Your driver’s license number
• The make and model of your vehicle
• The age of your vehicle
• Your address
• If you had any recent claims

While this information, you can fill into a quote directly, insurance companies will also examine your motor vehicle report (MVR) to determine if you have any recent driving violations on your record. Answering a few key questions can get you quotes. But underwriters will request a complete application before they issue the policy.

Insurance companies will frequently run a soft check on your credit to discover your credit score. Some states have outlawed the practice of using your credit score to set insurance premiums. If you want to have a better idea of what you may pay for car insurance, just take a look at this chart to discover what rates are being offered by major insurance companies in your state:

Read more: North Carolina Car Insurance Discounts

Average Car Insurance Rates by State and Company

Read more: Delaware Car Insurance Discounts

Due to the intensity that insurance companies use to try and make each policy reflective of an individual driver, the car insurance for marketing and advertising professionals could be the same or even more expensive than the insurance for drivers who work traditional blue-collared jobs.

Read more: Best Car Insurance in Your State

How can drivers obtain cheap insurance?

After learning all this, you may now be wondering, “What can I do to determine my premium makes affordable car insurance attainable?” Luckily, there is quite a bit that you can do to take charge of your insurance rates.

Practicing safe driving habits is the best way to keep your rates low, but if you have a low credit score, you can work on improving that as well. Not only will that help you get your finances in order, but you’ll be able to score cheaper rates on your insurance too.

If you’re still wondering, “How can I determine my premium or car insurance rates stay low?” you can rest easy. Most insurance companies offer a plethora of discounts to their drivers.

Whenever you think your rates are getting too high, examine this list of discounts by top insurance companies:

Car Insurance Discounts by Provider

Discount Name
Adaptive Cruise Control	✓	✓	✓	✓	5%	✓	✓	✓	✓	✓
Adaptive Headlights	✓	✓	✓	✓	5%	✓	✓	✓	✓	✓
Anti-lock Brakes	10%	✓	✓	5%	5%	5%	✓	5%
Anti-Theft	10%	25%	10%	25%	35%	5%	25%	15%		15%
Claim Free	✓	✓	✓	26%	✓	10%	✓	15%	23%	12%
Continuous Coverage		✓	✓		✓	✓	✓	✓	15%	✓
Daytime Running Lights	✓		✓	3%	5%	5%	✓	✓
Defensive Driver	10%	10%	✓	15%	10%	10%	31%	15%	10%	5%
Distant Student	✓	✓	✓	✓	✓	10%	✓		7%
Driver's Ed	✓	✓	✓	✓	10%	✓	10%	15%	8%	3%
Driving Device/App	✓	40%	✓	✓	30%	40%	20%	50%	30%	5%
Early Signing	✓	✓	✓	✓	✓	8%	✓	✓	10%	12%
Electronic Stability Control	✓	✓	✓	✓	5%		✓	✓	✓	✓
Emergency Deployment	✓	✓	✓	25%	✓	✓		✓	✓	✓
Engaged Couple	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Family Legacy	✓	✓	✓	✓	✓	✓	✓	✓	✓	10%
Family Plan	✓	✓	✓	✓	✓	25%	✓	✓	✓	✓
Farm Vehicle	10%	✓	✓		✓	✓		✓	✓	✓
Fast 5	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Federal Employee	✓	✓	7%	8%	10%	9%	12%	10%	5%	✓
Forward Collision Warning	✓	✓	✓	✓	5%		✓	✓	✓	✓
Full Payment	10%	✓	✓		$50	✓	✓	✓	8%	✓
Further Education	✓	✓			10%	15%		✓		✓
Garaging/Storing	✓	✓	✓		✓	✓	✓	✓		90%
Good Credit			✓	✓	✓		✓		✓	✓
Good Student	20%	20%	15%	15%	15%	15%	10%	25%	8%	10%
Green Vehicle	10%	✓	5%	✓	10%	✓	✓	✓	10%	✓
Homeowner	✓	✓	✓		✓	5%	✓	3%	5%	✓
Lane Departure Warning	✓	✓	✓	✓		✓	✓	✓	✓	✓
Life Insurance	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Low Mileage	30%	20%	10%	30%	30%	20%	30%	30%	20%	20%
Loyalty	✓	✓	✓	✓	✓	5%	✓	✓	✓
Married	✓	✓	✓	✓			✓		✓
Membership/Group	10%	✓	10%	8%	10%	15%	15%	5%	10%	25%
Military		✓	✓	15%	4%	✓			✓
Military Garaging	✓	✓	✓	✓	✓	✓	✓	✓	✓	15%
Multiple Drivers	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Multiple Policies	10%	29%	✓	10%	20%	10%	12%	17%	13%
Multiple Vehicles	25%	20%	20%	25%	25%	20%	12%	20%	8%	10%
New Address	✓	✓	✓	✓	5%	✓	✓	✓	✓	✓
New Customer/New Plan	✓	✓	✓	✓		✓	✓	✓	✓	✓
New Graduate	✓	✓	✓	✓	5%	✓	✓	✓	✓	✓
New Vehicle	30%	✓	✓	15%	✓			40%	10%	12%
Newly Licensed	✓	✓	✓	✓	5%	✓	✓	✓	✓	✓
Newlyweds	✓	✓	✓	✓	5%	✓	✓	✓	✓	✓
Non-Smoker/Non-Drinker	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Occasional Operator	✓	✓	✓	✓	✓	✓	✓	✓	✓
Occupation		✓			10%	15%	✓	✓		✓
On-Time Payments	5%	✓		✓	✓	✓	✓	✓	15%	✓
Online Shopper	✓	✓	✓	✓	✓	✓	7%	✓	✓	✓
Paperless Documents	10%	✓		✓	✓	5%	$50	✓	✓	✓
Paperless/Auto Billing	5%	✓		✓	✓	$30	✓	$20	3%	3%
Passive Restraint	30%	30%		40%		20%	✓	40%
Recent Retirees	✓	✓	✓	✓	4%	✓	✓	✓	✓	✓
Renter	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Roadside Assistance	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Safe Driver	25%	25%	30%	26%	20%	40%	30%	25%	10%	30%
Seat Belt Use	✓	✓	✓	15%	✓	✓		✓	✓	✓
Senior Driver	10%	✓		✓	✓	✓	✓	✓	✓
Stable Residence	✓	✓	✓	✓	✓		✓	✓	✓	✓
Students & Alumni	20%	20%	15%	15%	15%	15%	10%	25%	25%	25%
Switching Provider	✓			✓	10%	✓		✓	✓	✓
Utility Vehicle	15%	✓	✓		✓	✓		✓	✓	✓
Vehicle Recovery	10%	✓	✓	15%	35%	25%	✓	5%
VIN Etching	✓	✓	✓	✓	5%		✓	✓
Volunteer	✓	✓	✓	✓	✓	✓	✓	✓	✓	✓
Young Driver	✓	✓	✓	✓		✓	✓	✓	✓	$75

Using this list during your next policy renewal will help you secure great rates all year long.