Insurance premiums can be high for many different reasons depending on the type of policy that is being purchased. There are different factors for automobile policies, personal property policies as well as life insurance policies. Insurance premiums are calculated differently depending on the company writing the policy.
The premium for an automobile policy can be high for many different reasons. The typical reason a premium is high is because of violations found on an individual’s driving history. Violations and subsequent tickets can raise the cost of the premium substantially. Although, this isn’t the only reason whey the premium can be high. There are other factors that include the claims that have been submitted to the insurance company as well as an individual’s credit score. To offset the high premiums it is important to look for any and all discounts that can be applied to the policy. Many times the cost of the premium can decrease significantly.
A personal property or homeowners policy can also have a high premium. Usually, the premium will be high for this type of policy because there has been one or more significant claims made on an existing policy. Any claims that an insurer has to pay will result in a rate increase and higher premiums being paid for the policy. Another factor that can cause the premium to be high is the age of the home and its condition. An older home that has not had any updates will generally cost more to insure than a newer home that has a newer roof and updated utilities. Again, any discounts that can be applied to the policy can reduce the premium quite a bit.
One last type of policy in which premiums can be high is a life insurance policy. There are many reasons why the premiums on these policies can be high. One reason is the overall health of an individual. Most insurance companies want to know the general heath of an insured and if they smoke tobacco products. The premium for a smoker is going to be considerably more than a typical non-smoker. Another factor that can cause the premium to be high is the age of an individual. The older an individual is the more it is going to cost for the policy. The amount of coverage on a policy will affect the price of the premium as well.
Insurance policies from different insurance companies can be calculated differently depending on what criteria each company uses. It is cheaper to use one insurance company for all policies than it is to shop around and use separate companies. Many times insurance companies will offer a discount when one or more policies are written and in force with them.