Does Your Location Affect Your Car Insurance Premium?
Moved house since your last renewal? Thinking of moving to a new area but worried your insurance will rise? Well, to answer your questions, you need to put yourself in the shoes of the insurer.
To work out how much you have to pay for insurance, insurers must calculate how much risk is involved in your policy. This is determined by a number of risk factors.
There are many risk factors that insurers take into consideration when calculating the price you pay. Most of these are to do with your car, as you might expect. The model of the car you want to insure and the specifications of the said car are both factors when it comes to giving you a premium quote. Other factors outside of your car can include your age for example. By evaluating these risk factors, insurance companies paint a picture of the possible risk that you face and therefore how likely you are to claim.
For this reason, it’s important to have a car with good safety features built-in. An up to date car is a safer car in the eyes of the insurer much of the time. You can get a great deal on car finance in Essex with us, which will put you on the starting line ready to get your premiums.
Your address is a risk factor that many drivers don’t consider when purchasing insurance.
However, insurers DO.
Insurers will take into consideration your address for various reasons, including how densely populated it is and how safe the area is based on crime figures.
Living in a busy city centre like London will often see cause a car insurance price increase and your premiums are much more likely to be more expensive than in less populated parts of the country. This is because large cities attract more cars and more traffic. The more traffic, the more drivers you have to dodge on the road in the eyes of the insurer.
Living in Essex for example, there is no solid fixed answer to whether your location will affect your premiums as Essex is too large to put into one category when it comes to housing density and crime rates.
It’s not just big cities that are car insurance risk areas, if you live in an area with a high crime rate then you could see insurers raising the price of your insurance due to the increased likelihood of theft. It isn’t just theft either, insurance premiums can increase based on the assumption that your car is more likely to be vandalised or damaged to the point a claim would be required.
This may seem harsh, but when you consider that you spend most of your time driving in your local area or parked at your address if you live at a high crime rate location you can understand why this would have a significant impact on how much you pay for insurance.
So What Can You Do?
Firstly, when getting an insurance quote, not just within cars, it’s important to be as honest and direct as possible. Not only could a mistake on your policy see the cost rise dramatically but something as simple as knowingly entering the wrong address could see your policy voided completely overnight. This means that if you’re in an accident and you have submitted the wrong address to your employer, your cover is invalid and you’d have to find the price of repairs in your own pocket.
Not only would the insurer refuse to pay out if you make a claim but your policy will be marked as cancelled, which means you would be classed as driving without insurance. This is an illegal offence and you could face an unlimited fine.
You will also have to declare the fact you’ve had a policy cancelled when getting insurance in the future. This is a huge red flag for insurers and can bump up your future premiums and could even stop you from getting cover altogether in the future.
A little white lie may seem harmless at the time but it could not only end up costing you not only money immediately but money in the future too.
Luckily for you, there are a number of ways you can reduce the cost of your insurance premiums without having to commit any fraudulent activity:
- If you do live in a city centre or area with a high crime rate then making sure your vehicle is parked off the road, preferably in a locked garage. However, for a lot of people in dense areas, this isn’t an option. If it is, however, this can reduce the price you pay for insurance drastically.
- You should also make sure you have theft prevention systems installed. Make sure you have a working car alarm and immobiliser both installed and tested. By reducing the risk your vehicle has of being stolen, you should also see a fall in insurance premiums.
- Choose the level of cover you actually need
- Being clear on how you’re going to use the vehicle.
It’s also important to only pay for the insurance you actually need. Annual insurance isn’t always the best option for drivers, it’s important to find out exactly how much you’ll use your car and which policy suits you best based on this information.