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How Your Rhode Island Car Insurance Rate is Determined

As the Rhode Island car insurance industry has evolved, it has developed a specialized formula for assessing the potential risk in insuring a motorist. When a consumer has submitted his or her personal information to the car insurance provider, the provider then gleans information about the characteristics of the motorist. These characteristics are then assigned a risk value. The total sum of all the risk values is then weighted against the national average claim rate of those who share your characteristics. They then determine how much to charge you in monthly premiums based upon this information. As car insurance is mandated by the government, some consumers feel that it is unfair to allow a company, unchecked, to decide what rates to charge a person. However, an company is a for-profit business and must operate as such.

The information about your location is derived from the zip code you provided when you filled out your car insurance quote information for Rhode Island. The zip code provides the Rhode Island car insurance company with several details about your community. The crime rates in your zip code allow the car insurance provider to determine how likely you are to be victimized by a crime. Your monthly premiums will rise in accordance with how much the Rhode Island car insurance company thinks it will cost to protect you. A general idea of your financial status can also be derived from a zip code. Your zip code can allow a Rhode Island auto insurance company to determine if you live in a higher income neighborhood versus an inner city neighborhood. While it may not be fair, a Rhode Island car insurance company will use this information to determine who they would like to actively pursue as a client.

The information about your personal characteristics is used in assigning a risk factor to you as a driver. In reviewing the average performance of people sharing your characteristics, like age or gender, the industry has determined which characteristics tend to lead to increased risk. Single males under the age of twenty-five are considered to be the highest risk group among drivers to insure. On the opposite hand, married, middle-aged females are considered to be the lowest risk drivers to insure.

The information about the vehicle you wish to insure is requested when you fill out the questions of your car insurance quote and is used to determine the risk you represent. There is a nationwide, collective database in which Rhode Island car insurance companies keep a tally of the type of vehicle that is involved in claims as well as the average cost of repairs to these vehicles. The more frequently that a particular type of car is involved in a claim, the higher the premium will be for that kind of car. Imported sports car or high end luxury cars are generally among the most expensive to insure while lower end sedans are usually among the cheapest.

Now that you are informed about the metrics used in determining your monthly premiums, you can be aware of what actions you can take to lower your rates. Receiving your free, online car insurance quote is the first step towards finding a policy with low rates. Regardless of whether you live in Providence or Warwick, you can find an affordable rate for Rhode Island car insurance in your location. Get started today.

So what are you waiting for? Compare cost and coverage details from the Rhode Island cities of: Providence, New Bedford, Fall River and more.