Although one hears a great deal of complaining when it comes to the cost of covering a vehicle, affordable auto insurance is actually easy to get for those who keep a clean driving record and are smart about what and when they drive. It is true that the term “affordable” is a relative one, but depending on where you live and what type of vehicle you drive, you can obtain basic liability and uninsured driver protection for as little as $30 a month.

The first step however is to understand just how insurers determine car insurance cost.

Tools of the Trade

One of the most lucrative professions for mathematicians these days is not in the sciences or education, but the insurance industry. Actuaries are the ones who determine risk, using a highly complex set of algebraic equations known as an actuarial table. This information is what underwriters use to determine how much someone will ultimately pay for their insurance. It is not prophecy, nor always 100% percent fair the use of actuarial tables is more like scientific calculations of odds at a Las Vegas casino. Nonetheless, until someone invents a time machine allowing us to literally see into the future, this is the best way to determine risk.

What Goes Into the Equations

It is fairly common knowledge that factors such as age, gender and experience are used to determine who can get low car insurance premiums. Young males, historically, are willing to engage in riskier behavior and frequently do (consider that virtually all combat pilots during the First and Second World Wars averaged 21.5 years of age). Even as they get older, men are more likely to be injured or killed than women. It should therefore come as no surprise the car insurance for women tends to be less expensive.

One way to qualify for cheap car insurance for young drivers is to maintain good grades; most insurers are happy to offer “good student discounts” to high school and even college students who maintain a high GPA.

The type of vehicle make, model and age is yet another big determining factor in setting auto insurance premiums. If you are in the market for a vehicle, you should definitely take this into consideration when making your choice; an SUV or a sports car is going to cost you much more to insure than a four door sedan or family wagon. Replacement cost is another factor; it’s no secret that the letters “BMW” means “Bring Massive Wallet,” because repairs for BMW vehicles are extremely expensive. Buying a domestic vehicle not only supports domestic industries and workers, it also lowers your insurance costs.

One thing that is changing is the practice of basing the amount of one’s insurance premiums on one’s credit score. This practice has been controversial for several years and has been made illegal in the more progressive states such as Washington and Oregon. The current federal financial reforms are supposed to end the practice of “universal default,” but it is currently still allowed in some states.

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