| The law requires liability insurance for all drivers and | | | | fast or dangerous your rate will be increased by a set |
| vehicles. This means that if you are involved in a | | | | amount. If it is very old, your rate goes up. If you've had |
| serious accident, and it turns out that it was your fault, | | | | one or more accidents in the past, your rate will go up. |
| your insurance company will pay out any claims that | | | | If you're young and male, your rate will go up. The |
| are made against you. Extra coverage on your own | | | | more of these factors you satisfy, the more your rate |
| vehicle, called comprehensive insurance, is optional. | | | | will be going up. |
| Insurance companies based on a number of risk | | | | Discounts |
| factors will calculate the price you pay for this | | | | As a sales enhancement, many car insurers offer a |
| insurance. Basically how it works is the more they feel | | | | "low estimated future mileage" discount to customers |
| you are at risk of crashing, and the more they think the | | | | who predict that the car's mileage will be below some |
| resulting crash will cost them, the higher the premium | | | | stated limit during the next premium period. There is no |
| you'll pay. | | | | verification involved and no additional charge if the car |
| Assessment | | | | is subsequently driven more than the stated amount. |
| Common factors that will be used to assess the | | | | This arbitrary discount tends to foster customer belief |
| premium are the value of the car you're driving, the | | | | in the mistaken idea that "miles" are just one of many |
| safety of that vehicle, the coverage you want, will | | | | classification factors used to raise or lower prices |
| there be deductibles or limits etc.? How much you'll | | | | from the territorial base rate. In fact, odometer miles |
| drive the car, how your driving record stands, how long | | | | (which insurers do not use) are not a factor but a |
| you've held your license, your age, and if you are | | | | metric - the only valid basis for measuring each car's |
| young, also your sex. | | | | consumption of insurance protection in on-the-road use. |
| The premium is then calculated. Usually there is a flat | | | | The best way to save on car insurance is to shop |
| per car, per year rate that everyone pays, regardless | | | | around, keep a good clean driving record, drive safely, |
| of other factors. The other factors will then alter this | | | | and choose reliable cars that are not known for their |
| rate, generally upwards. So if your car is especially | | | | power and speed. |