Why My Car Insurance Premium is Really Low

I pay $267 a year for my car insurance. For reference, I have the maximum liability limits, medical coverage, no deductible comprehensive, and $500 deductible collision. If I dropped comprehensive and collision coverage, my premium would be about $150 per year. There are two types of reasons for my insurance being low: situational factors and price discounts.

Situational Factors

Age - I'm over 50 which lowers my premium. The ages of 21 and 25 are other threshold year for males.

Marital status - Being married also lowers my premium.

Vehicle age - Every year the value of my vehicle declines which reduces the collision and comprehensive premiums. My truck is currently 7 years old.

Low mileage - We drive my spouse's car for most family trips. As a result, my truck is driven less than 7500 miles a year. In the past, I also had discounts for driving less than 10,000 and 12,000 miles a year.

Good driving record - I have only one accident from 1989 on my record. My spouse has no accidents.

Price Discounts

Multiple vehicles - We insure both our vehicles with the same insurance company.

Bundled insurance - We have all our property and liability insurance (auto, home and umbrella) with one company.

For reference, the same insurance coverage for a single 23 year old mail purchasing only car insurance is over $1200 per year. Surprisingly, if I purchased a 2010 Lexus IS350, my insurance premiums would still be fairly reasonable, rising to only $400 per year. For the single 23 year old male, the insurance cost on a 2010 Lexus IS350 would be $1850 per year.

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This is not financial or insurance advice. Please consult a professional advisor.

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