By Susan Willis

For a teenager, a car represents a lot of things, including personal freedom, the chance to express a personal sense of style, and a very practical means to get around town and get things done. And, for those teens who have purchased their own car and who work odd jobs in order to maintain it by paying insurance, gas, and maintenance costs, it also represents the opportunity to show how responsible they can be.

For parents, feelings about their teen’s car usually are mixed. On the one hand, the parent is proud of the teen as a new driver – and doesn’t mind having someone else around to go fetch a gallon of milk at the store now and then. On the flipside of all of those positive feelings are some potential downers for the parent, including worry over their teen’s inexperience in driving. And, they also think about any expenses the parent may have to shoulder, like car insurance.

What any teen or parent who has shopped for car insurance knows is that average insurance rates vary greatly by the car model being shopped for. For anyone looking to save money in auto insurance, it is wise to know which types of models are the most and least-costly before the car is purchased. But, who is in charge of the complex task of figuring out how much to charge clients who drive each type of car? Enter the actuary.

Actuaries are those accountant-like number crunchers with very thick glasses (okay, this is a bit of a generalization but you get the idea). Their job is to create actuarial tables that, based upon a huge numbers of variables, determine how much to charge each person for insurance. In terms of car models, actuaries take into account about 5 factors to determine rates.

If you are looking for the car with the cheapest insurance rate for a teen, learn about these 5 factors that influence car insurance rates:

1. Sticker price:

There is a strong correlation between car sticker price and insurance premiums. The more the potential total cost of the loss that the insurance company would have to pay, the higher the rate.

2. Degree of car-driving pleasure:

The more that the car is built to be fun to drive, the higher the rates. Sound like a cruel insurance industry trick? This rule of thumb actually has some very sensible underpinnings. Cars with more horsepower and sport-tuned suspension are going to be driven harder and more dangerously, on average. Think of the danger factor in mini-van vs. Porsche.

3. Profile of the average person who drives that car:

Insurance companies keep tabs on profiles of what the average driver of each given model is like. They base their rates in part on this profile. What drives up costs are profiles with factors like the tendency for driving during peak commuting hours, driving at night, and driving aggressively.

4. Loss history for that model determines collision and comprehensive rates:

Those models that tend to be involved in more accidents are accompanied by higher insurance rates. Makes perfect sense, doesn’t it?

5. Safety record and features:

Cars with a better safety record and which are equipped with more safety features naturally pose lower medical bill-related claims risks and are therefore cheaper to insure.

Keep these 5 factors in mind as you look for the car with the cheapest insurance rate for teens.

About the Author: Find more tips and the cheapest car insurance rates for teens at:

Cheapest Car Insurance for Teens

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Source:

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