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How Car Insurance Premiums are Calculated

The make, model and year of your car, the driving records of people who use it and where you live are all considered by insurers when setting rates.

At DPM insurance Group, our team of brokers and CSRs are prepared to help you make the informed decision to ensure you have the coverage you need at the best premium available.
For the majority of people, a vehicle is often one of the biggest purchases they make. While there are numerous factors that will go into the calculations to determine your insurance one factor is the type of car you drive.

Generally, the harder your car is to steal and the less expensive it is to repair, the less you pay for insurance. So, buying or leasing a car with a lower-cost insurance rating is one way you can take control of your costs. Another factor is how the vehicle is rated by the Insurance Institute for Highway Safety.

How to lower your premium.

Provide your car’s vehicle identification number or VIN to your insurer. Some cars are more expensive to insure. Without the correct VIN, you could be quoted a premium for a different – more expensive make or model – car. To save money, you can also: increase your deductible; drop collision coverage on an older car that does not have a loan against it; look into a package deal for your car(s) and home; and, install an approved theft deterrent system in your car

Maintain A Good Driving Record

License suspensions, parking tickets and convictions for driving offenses all add up to higher car insurance premiums. In fact, after being convicted of a driving offence, it can take up to six years for your record to be considered clean again by insurers. Over the years, building a consistently accident-and conviction-free driving record can help reduce your premium.

Unless You’re Willing to Move

It’s a fact that many urban areas have varying degrees of higher claims costs. Higher population density equals more risks, more accidents and more thefts. For example, the average claims cost per vehicle in one city might be as high as 25% above that of a neighboring city. While there are bad drivers in every city, on average, some areas have a higher than average claims costs than others. And as claims costs rise, so do premiums. In reality, unless they’re prepared to move, this is one of the factors most drivers have no control over when it comes to setting their premium.

How CLEAR and Telematics Can Save You Money

Insurers use the Canadian Loss Experience Automobile Rating (CLEAR) system to assess the likeliness of your car being involved in a claim and what it will cost. Current data for each make, model and model-year of car is used to calculate expected and actual claims loss experiences. Choose a car with a lower claims risk and CLEAR number and you can expect a lower premium.

You can also learn about new cost-savings offered by telematics . By installing a technology device in your car that records your driving activities, insurers can use this information to personalize your insurance premium.

Source notes: Insurance Bureau of Canada



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Blenheim Office

24 Marlborough St. N., Box 479
Blenheim, ON N0P1A0

Phone: 519-676-8159
Fax: 519-676-0020

Chatham Office

250 St. Clair St.
Chatham, ON N7L 3J9

Phone: 519-352-4343
Toll Free: 1-800-561-4949
Fax: 519-352-6484

Essex Office

29 Talbot St. N, Box 69
Essex, ON N8M 2Y1

Phone: 519-776-6457
Fax: 519-776-7400

Harrow Office

65 King St. W., Box 790
Harrow, ON N0R 1G0

Phone: 519-738-2277
Fax: 519-738-2279

Tilbury Office

59 Mill St. E, Box 1239
Tilbury, ON N0P 2L0

Phone: 519-682-0202
Fax: 519-682-2391

Wallaceburg Office

403 Wellington St.
Wallaceburg, ON N8A 2Y2

Phone: 519-627-1777

DPM Insurance is a BrokerLink company. The BrokerLink companies are subsidiaries of Intact Financial Corporation (TSX: IFC)