Car Insurance Estimate

Car Insurance Estimate

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Recreational Vehicle Insurance Car Insurance Estimate Florida Auto Insurance

Car Insurance Estimation Rates

Except for government controlled liability insurance, most car insurance plans charge a premium based on several risk factors that should have an impact on the frequency of occurrence or on the expected cost of future claims. The premium usually depends on the car characteristics, the coverage selected, the usage of the car such as commute to work or not, predicted annual distance driven, driving history, credit rating, as well as the age and, for youth rates, sex of the driver. For mandatory liability insurance, risk factors are taken into account giving varying prices and in others a fixed rate is charged regardless of the individual circumstances.

Flat rate

Car insurance plans sometimes charge a flat per car or per year rate regardless of how much the car is used. But because a time unit provides no actual measurement of the actual miles of driving exposure each car consumes during the insured year, insurers may not have credible statistical basis for the cost comparisons used to support price classifications.

Reasonable estimation

As a sales enhancement, many car insurers may offer a low estimated mileage discount to customers if they predict that the car's mileage will be below a certain limit during the next premium period. Usually there should not be a verification involved and no additional charge if the car is subsequently driven more than the stated amount. Such discount tends to foster customer belief in the mistaken idea that miles are just one of many classification factors used to raise or lower prices from the territorial base rate. Odometer miles that insurers do not use are not a factor but a metric - the only valid basis for measuring each car's consumption of insurance protection in on-the-road use.