Motor insurance premium is calculated based on a variety of factors such as the type of car, its make and model, the engine size, the state or region where the car is being used and the driver’s age, gender and driving history.
The car's value, its parts and components, the cost of labor and the highest risk of theft may also affect the insurance premium. Insurance companies factor these variables together to determine how much risk the policyholder is likely to pose and the cost of insurence.
For instance, a driver with a lengthy record of traffic violations may be required to pay a higher premium than someone with no violations.
Insurance companies also weigh how likely it is that the car may be involved in an accident and how much it would cost to replace it or repair it. In addition, the insurance company will assess the driver’s personal liability coverage requirements and any additional expenses associated with special risks posed by the driver, such as a higher risk of theft or the cost of services used in the event of any claim.
Ultimately, your motor insurance premium is determined by a combination of factors that reflect each individual’s risk profile. To get the best deal, it is advisable to shop around and compare different policies to find which insurance company offers the best solution that fits your needs.