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Your Car and Short Term Car Insurance

Updated on April 8, 2010

Car Insurance Has A Lot Of Factors That Can Affect The Total Outcome Of Your Premium Rate

Car insurance has a lot of factors that can affect the total outcome of your premium rate. Of course included are the benefits, coverage, and term or duration of coverage. Basically, it is a “what you paid for is what you get” type of basis. Many are unaware though that the type of vehicle they drive greatly affects their short term car insurance costs and prices. Insurance companies seek statistics and data on your car’s model, manufacturer, and price in order for them to adjust their costs accordingly.

How does it all work? Well primarily for the most obvious of reasons, if your vehicle is on the higher end or is considered a luxurious brand, any damage done to or by the car will result in big costs for the company. Since car part replacements for that will also be just as high as the vehicle’s worth, repair expenses will also be expensive. You will end up having to pay more in premiums when compared to other clients because of your car’s sticker price. This kind of coverage however won’t suit short term car insurance because repair benefits are usually minimal and superficial which some policy owners would even list as their deductibles.

Insurance companies will also be looking into the market price of your vehicle. If it is old, relatively cheap, or pretty basic, you can opt to no longer avail of a collision and comprehensive coverage. By doing this, you can lower the rates of your short term car insurance. If your car is new or if you are deciding on whether or not to buy a new car, always remember that the cost of the car is not the only point for consideration but you must also consider the cost of insurance policies that come with it. High end cars mean higher insurance premiums. You cannot do without it though since most local laws require all vehicles, whether old or new, temporary or permanent, to be insured.

Moving on to statistics and numerical data, insurance is a science as some say and that is because companies take into consideration the probability of car accidents, damage, or theft done on a vehicle. Hypothetically speaking, if your car model is known to have several manufacturing defects or that it is infamous for mechanical failure, premium rates will go up to compensate the possibility of that happening. Short term car insurance costs here depend on the vehicle model regardless of who is going to drive it. Many institutions collect such data for both the insurance companies and for drafting precautionary measures to avoid these in the future. It also serves as an independent research branch that assesses car manufacturer’s models.

Some insurance companies offer discounts for cars with lower mileage or usage. Others would even provide bonuses for individuals who frequently take public transportation since the vehicle insured will be used less often, which in turn would lead to less probabilities of anything happening to it. In general, the type of car you get factors in a lot in your short term car insurance in terms of cost and coverage.


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