What you need to know about crime rates and car insurance costs.
When calculating auto premiums, insurance companies take several factors into account. One individual factor they will look at is the crime rate in the area that you live in. But what does local crime have to do with your insurance cost? Here’s what you need to know.
How Insurers Check Crime Rates
Car insurance providers use your zip code to check up on the crime rate in your area. This is why they ask you to provide your zip code on your auto insurance quote request form. Insurers are looking for specific, car-related crimes such as the following:
- Vandalism
- Break-in
- Car theft
- Accident rates
- Fender benders
- Hit and runs
The Connection Between Crime Rates and Your Insurance Costs
Auto insurers calculate your rates based on how likely they think you are to file a claim. Drivers who are more likely to file a claim will be charged higher insurance rates. If you live in an area with high crime rates, then auto insurers recognize that you are at greater risk for having your car vandalized, stolen, damaged in a hit-and-run, and so on. Because you would file an insurance claim for these issues, auto insurers look to protect themselves by raising your rates.
On a happier note, if you live in an area with low crime rates, then you will have access to lower auto insurance rates. This is because the insurer assumes that you are at lower risk of experiencing a claim-related event.
This is what you need to know about crime rates and your auto insurance premiums. Do you have more questions about your car insurance? If so, then contact the experts at Phocus Insurance in Phoenix, Arizona. Our dedicated team is eager to assist you with all your car coverage needs today.
