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Which factors that affect your car insurance premium can be confusing. Here are a few factors that are important for Massachusetts drivers to consider. (Spoiler alert: some of these you can control!)

It's important to understand underwriting and rating before jumping into factors that can affect car insurance premiums. Underwriting is the way a company decides it wants to write a policy. The company sorts applicants into groups of people that have similar risk and then decides to accept, deny, or limit coverage. Rating is how a company figures out your actual premium. A rate for each group is set based on the claims paid by the insurer for the people in that group. The higher the average losses from a group, the higher the rates for that group.

It is important to note that in Massachusetts, insurers may not use sex, marital status, race, creed, national origin, religion, occupation, income, sexual identification, and gender identity factors for underwriting. For rating, Massachusetts companies may not use sex, marital status, race, creed, national origin, religion, occupation, income, education, sexual orientation, and gender identity. Insurance companies are also prohibited from using credit information from consumer reporting agencies for either underwriting or rating.

So what factors can affect your car insurance premium? Here are a few:

Car make and model. Some cars are cheaper to insure than others. Car insurance companies prefer to insure safe vehicles, as they’re less likely to lead to expensive claims, so a car with high safety ratings may get you a lower rate than one without. Some vehicles, like Honda Civics and Ford pickup trucks, are statistically more likely to be stolen. They tend to be more expensive to insure as a result.

Driving record. Your driving record will always be a big factor in determining how much you pay. Driving safely and keeping a clean driving record will reduce your car insurance premium regardless of what company you are insured by. Companies have their own rules, known as Merit Rating Plans, to determine how your driving record affects your premium. These plans lower your premium based on years of incident-free driving. They can also raise your premium if you have accidents and traffic violations. In Massachusetts, an insurance company's Merit Rating Plan cannot use any accident or traffic violation that is greater than 6 years old from the policy effective date or increase the premium for accidents or traffic violations for more than 5 years.

Age. Age is a very important factor when it comes to understanding car insurance premiums. Teen drivers have a tendency to drive more recklessly and get into more accidents than any other age group. This is why in the insurance premiums for teens are typically the highest. Age becomes a less important factor at the age of 20, and even less by 25. Car insurance rates reach their low point in a driver's mid-50s before rising for older drivers aged 70-plus.

Zammito Insurance is always available to answer your questions regarding auto insurance as well as business, home, and renter's insurance. Give us a call at (781) 762-6732 to find out more.


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