Choosing A Great Insurance Policy

4 Things That Can Impact Your Car Insurance Premium

According to reports compiled by, the average annual premium rate for car insurance in the United States is just over $900. If you are paying more than the average, you may be wondering why and what you can do to reduce your insurance premiums in the future. Here are four things that car insurance agencies often use to determine the rates they charge. 

Driving Record

It goes without saying that your driving record is one of the most crucial criteria that is looked at. Previous tickets for moving violations can have a huge impact on the premium quotes you are given when shopping for a new car insurance policy. Your driving record also lists at-fault accidents, which can also impact your premium. 

While it's impossible to change your driving record history, you may be able to improve your chances of getting a lower premium by taking defensive driving and driver training courses. Many car insurance companies offer discounts to those who complete these types of courses. 

Criminal Record

Car insurance companies also look at criminal records. Of course, convictions such as DUIs, reckless driving, and hit-and-run can definitely raise your premium. However, it's important to understand that criminal records also show charges where there was no conviction, because court hearings are listed in criminal records. Even without a conviction, you may still be considered high risk and, therefore, be quoted a high premium. 

If you have any convictions or charges on your record, you may be able to have them expunged, depending on the laws in your state. An expungement will wipe the conviction or charge clean from your record. After an expungement, your record will not include the conviction or charge. Speak with a criminal attorney in your area to find out how to expunge your record. 

Credit Score 

Your credit score is also used to determine what your premium will be. The reason for this is because those who have poor credit tend to have higher odds of filing claims against their car insurance policies. This may be because people with poor credit may have a more difficult time paying for minor collision repairs. There's also a risk that people with poor credit are unable to pay for or secure financing for necessary vehicle repairs to keep their vehicles safe and road-worthy. 

Work hard on improving your credit score, especially if it is poor or bad. Start by obtaining credit reports from the major credit bureaus and study them to see if there are any discrepancies that could be cleared. Make sure to pay your bills on time and, if possible, go to a credit counselor in your area for help. 

C.L.U.E. Report 

Another report that car insurance companies use to determine premiums is C.L.U.E., which stands for claims loss underwriting exchange. This report comes from a database that includes information from previous claims you have taken on your car insurance policies, if any, in the last seven years. Car insurance companies use this database to determine if you are at risk of filing claims. 

While filing claims make sense when you've been involved in collisions, it's important to weigh the consequences of filing claims when they aren't entirely necessary, such as for minor dents that you can pay for out of pocket. Also, just as with your credit report, it is crucial that your C.L.U.E. report is accurate. Order a C.L.U.E. report to see if there are any mistakes on it so you can rectify the situation before you start getting quotes from new car insurance companies. You can order your C.L.U.E. report by mail or by phone.