I’ve heard more and more stories where insurance companies are getting creative with how they come up with their auto insurance premiums, to where some dynamic factors are brought into play.
Traditionally, insurance premiums are set by fairly static inputs:
- Where you live – The frequency of crime in your area plays a big role in what you pay for insurance
- What car you drive – Certain cars are more likely to be robbed and I’ve even heard that certain colors of cars (bright red) have a higher incident of accident, so you could pay more for certain elements
- How much you drive – Our insurance premium factors in how many miles we put on our car during an average period. The more you drive, the greater chance you have of an accident, I suppose.
There are things here that are within your control, most namely the type of car and the features you have, but a lot of these factors are probably a bit out of your control. Most people aren’t going to move so that they can drive a few miles less to work, leading to a few bucks getting knocked off your policy.
But what if there were other factors that could directly impact your prices?