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1) How you drive
Your driving record is one indicator of how much of a risk you pose while on the road. Generally, the better your driving record, the lower your insurance rates. Take your driving record seriously and you could start to see a drop in premiums.
Your driving record is based on:
- The number of years you’ve been licensed to drive
- Any convictions due to driving infractions
- The number of accidents you’ve had
- Speeding tickets and moving violations.
Don’t forget that a licence suspension could impact your driving record.
2) What you drive
When it comes to theft, safety and how they fare in a collision, some vehicles are deemed riskier than others. Therefore, the make and model of your vehicle does affect your insurance rate.
Getting CLEAR about your auto. Insurers consider the cost of replacing a vehicle. One of the ratings they may look for is the Canadian Loss Experience Rating (CLEAR). Updated annually, CLEAR uses insurance claims data to place every make and model on a claims-risk grid. The higher the risk, the more you’ll pay.
Cost to replace. Insurers also look at the cost of repairing or replacing your ride should it be stolen or involved in an accident. Generally, newer and luxury models will cost more to insure for this very reason.
3) How often you’re behind the wheel
This one comes down to simple statistics: The more you use your vehicle, the greater your chances of being involved in an automobile accident — and the higher your insurance premium.
Insurers also take into account the number of drivers who use your vehicle and their driving records as well.
4) Where you live and where you “fit”
Car insurance rates are generally higher in and around large urban areas due to a higher number of accidents and theft or vandalism claims. So, where you live is a factor.
In some provinces, insurers establish categories to classify people with similar profiles. Belonging to a group that is more likely statistically to be at fault in an accident or drive more recklessly could affect your insurance rate.
5) The coverage you choose
While your provincial or territorial government dictates the minimum amount of insurance your must carry, you generally have a number of choices to make about the kind of coverage you want to carry and the size of your deductible.
Generally:
- The more protection you carry, the more it will cost to insure the vehicle
- The lower the deductible, the higher the premium
To find out more about coverage minimums in your province, read the IBC’s Car Insurance Where You Live.
The amount of coverage you carry is an important choice which affects the level of protection afforded by your insurance policy— but it’s also a personal one. Speak to your insurance provider about your unique situation.
6) Factors beyond your control
Some factors are not directly related to you or your vehicle. For example, your insurance premiums may be affected by economic factors (markets, inflation) and government policies (taxes, regulations).
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