Auto Insurance History From Time To Time

Auto Insurance History From Time To Time

Conventional methods for determining costs of Auto Insurance or Motor Vehicle Insurance involve gathering relevant historical data from a personal interview with, or a written application completed by, the applicant for the Auto Insurance and by referencing the applicant's public motor vehicle driving record that is maintained by a governmental agency, such as a Bureau of Motor Vehicles. Such data results in a classification of the applicant to a broad actuarial class for which insurance rates are assigned based upon the empirical experience of the insurer. Many factors are deemed relevant to such classification for Auto Insurance in a particular actuarial class or risk level, such as age, sex, marital status, location of residence and driving record.


The current system of Auto Insurance creates groupings of vehicles and drivers (actuarial classes) based on the following types of classifications.

1. Auto Insurance for Vehicle Type : Age; manufacturer, model; and value.
2. Auto Insurance for The Driver : Age; sex; marital status; driving record (based on government reports), violations (citations); at fault accidents; and place of residence.
3. Auto Insurance Coverage : Types of losses covered, liability, uninsured or underinsured motorist, comprehensive, and collision; liability limits; and deductibles.

The classifications of Auto Insurance, such as age, are further broken into actuarial classes, such as 21 to 24 year olds, to develop a unique vehicle insurance cost based on the specific combination of attributes for a particular risk. For example, the following information would produce a unique vehicle insurance cost:

1. Auto Insurance for Vehicle : Age - 7 years old; manufacturer, model - Ford, Explorer XLT; value $ 18,000
2. Auto Insurance for The Driver: Age - 38 years old; gender - male; marital status - single; driving record (based on government reports) violations - 1 point (speeding); at fault accidents - 3 points (one at fault accident); place of residence 33619 (zip code)
3. Auto Insurance Coverage : Types of losses covered; liability - yes; uninsured or underinsured - no; motorist comprehensive - yes; collision - yes; liability limits - $100,000/$300,000/$50,000; deductibles - $500/$500.

A change to any of this Auto Insurance Information might result in a different premium being charged if the change resulted in a different actuarial class or risk level for that variable. For instance, a change in the drivers' age from 38 to 39 may not result in a different actuarial class because 38 and 39 year old people may be in the same actuarial class. However, a change in driver age from 38 to 45 may result in a different Premium Auto Insurance because the records of the insurer indicate a difference in risk associated with those ages and, therefore, the age difference results in a change in actuarial class or assigned risk level.

Current Auto Insurance Rating Systems also provide discounts and surcharges for some types of use of the vehicle, equipment on the vehicle and type of driver. Common surcharges and discounts include:

1. Auto Insurance Surcharges for Business use.
2. Auto Insurance Discounts : Safety equipment on the vehicle airbags, and antilock brakes; theft control devices passive systems (e.g. The Club), and alarm system; and driver type - good student, and safe driver (accident free); group - senior drivers fleet drivers .