These 5 Factors Determine Your Car Insurance Premium
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Basically, the fees that must be paid if you want to transfer the risk of loss to the insurance company are known as insurance premiums.
Premium is the amount of money that must be paid in each period (monthly or annual) as the obligation of the insured for his participation in insurance. All types of insurance require premium payments, including motor vehicle insurance (car or motorcycle).
The amount of premiums (also called premium rates) that must be paid is determined by the insurance company taking into account the conditions or conditions of the insured.
Determinants of Premium
Each insurance company has its own rules in determining the amount of premium even though the Financial Services Authority (OJK) has set a lower and upper limit of the percentage of the premium rate.
However, the insured also needs to know what factors are generally used as the basis for determining the amount of motor vehicle insurance premiums.
Here is an explanation of several factors that determine the amount of vehicle insurance premiums, especially car insurance.
Type of Guarantee (All Risks or Total Loss Only / TLO)
The premium for all risks guarantees will be higher than the premium TLO. Moreover, if the guarantee of all risks is coupled with the expansion of other guarantees (comprehensive) that will increase the amount of premiums.
Transportation type
Specifications, conditions, usage, up to the price of the vehicle on the market will be a consideration to determine the amount of car insurance premiums.
Location
The insured's domicile will affect the amount of the premium. Insured who is domiciled in a disaster-prone area or criminality are certainly subject to a greater car insurance premium.
Age
Insured in the age range under 30 (<30) years and above 60 (> 60) years is likely to be subject to high premiums because they are considered potentially more careless or inadvertent. Based on accident data statistics, the age group above has a greater risk of experiencing an accident.
Other Determinants
Other determinants, such as the insured's driving track record, the addition of security systems, and so forth.
With an explanation of some of the factors determining the amount of cheap car insurance premiums above, we hope that you as an insured can understand how to determine premiums.
If lucky, you can receive cheaper insurance premiums for your vehicle.
