domenica 24 gennaio 2010

Why Do Premiums Of Insurance Businesses Differ So Much?

By Clare Leith

It is often difficult to get a decent price on auto insurance and finding a good policy can be frustrating. The various companies do not all offer the same policies. In fact some companies promote one price and charge another when it comes time to sign the policy. However it is still possible to find reputable insurance companies.

Finding a reputable company that offers low premiums can be a daunting task. There are numerous factors that play a role in determining what the premium will be. Some of these factors make it almost impossible to compare different policies. Some companies offer to a policy comparison for you. While this sounds good you need to be careful with this, because they do not always play fair. They somehow always manage to come out on top with the best premiums according to their comparison.

In some cases the policies that are being compared are not exactly the same. To avoid getting mislead you should do a little home work. Check with the companies that are mentioned in the comparison and make sure they are reputable companies. You should contact these companies and ask if the price you were quoted is their best price for coverage on your vehicle.

It helps to know that makes up an insurance policy and how the premium is determined when looking for an affordable policy. The first thing you should understand is that there are several different aspects of an auto policy. The liability section is the part of a policy that governs the minimum amount of coverage that is provided by the policy. There may be some regulations in your area pertaining to the minimum coverage permitted by law; it is a good idea to make sure that the liability is at least equal to the amount required by law.

There are also collision and comprehensive sections of the policy. Collision provides for the cost of damages caused as the result of an accident. There are limitations to what will be covered based on the damages.

Comprehensive is designed to provide coverage in areas that are not provided by the other sections. One example of this is the write off a loan. If there is a loan owed on a vehicle and this loan exceeds the amount provided by the collision then the comprehensive may cover this.

It is important to check that each of these sections are the same in each quote that you are receiving. The different types of coverage are some a few of the factors that can affect premium prices. Many of the other factors have to with the driver and their driving record. The age and sex of the driver make a difference as does the type of car.

When considering a driver for a policy, the issuing company will typically review a driver's insurance score. There are several factors that affect a driver's score. There is a problem involved with this score, in the fact that not all companies look at this score the same way.

Many companies treat the way they evaluate the score as a major secret. They may be willing to provide the score of a driver but chances are they are not going to explain how the score is evaluated. The different ways that scores are looked at play a huge factor in the difference in policies premiums.

You will be wise to evaluate an auto insurance policy carefully before signing it. You should also inquire about a company's reputation; you can do this with friends and by checking with some websites that provide consumer information. When considering a company it is a good idea to find out their claims payment rating. Some companies are better at paying premiums on time, while others are just in the business of collecting premiums.

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