A recent J.D. Power study showed that many motorists don’t know what will impact their bill.
J.D. Power recently released the results of a study that they conducted which showed that the majority of vehicle owners don’t have an accurate understanding of the factors that will cause their auto policy premiums to change.
This lack of understanding could be causing these consumers to pay too much for their coverage.
At a time in which the cost of an auto policy is already rising in many places, it is important for consumers to have a more accurate concept of what will and what will not impact the amount that they pay every month in order to keep their vehicles insured. A J.D. Power senior director, Jeremy Bowler, explained that “In 2013, there was a sharp rise in the number of customers who have experienced premium increases.” He added that the actual “dollar amount of those increases was also larger, averaging $153 in 2013 compared with an average rate increase of $113 reported in the 2012 study.”
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However, by failing to understand the way that costs are calculated on an auto policy, this only gets worse.
Consumers are often holding themselves back by failing to understand what factors will impact the calculations of auto insurance rates. A recent survey by InsuranceQuotes.com indicated that among American vehicle owners, 43 percent were under the incorrect impression that the size of their income influenced the amount that they would be required to pay for their coverage. From that same research, another 36 percent felt that their position at work was the largest factor that was considered when calculating their premiums.
While many insurance companies do take some of those factors into consideration as a part of a broader attempt to understand the risk associated with a given driver, those are not typically major influencers in the total amount of the monthly bill. In fact, there are other factors that have a far greater impact on the premiums being paid every month, but that many people don’t realize are important, such as education and marital status. Married people with college degrees pay notably less for an auto policy than single people with a high school diploma and with an equivalent driving record.