HELPFUL REMINDERS

Even if you’ve been driving for many years, you may not know as much about your auto insurance company as you think you do. Here are three things you should know about your auto insurer:

1. Many people assume that when an auto insurance company is evaluating a potential policyholder, all that counts is their driving record. Not so! Almost every carrier considers credit to be a very important rating criterion. Insurers believe that the better your credit history, the less likely you are to file a claim—and the more likely you are to make your premium payments on time.
   
   Be aware that if you’ve always paid your bills on time and in cash instead of applying for credit, that’s not a plus. Your lack of a credit track record makes you an unknown quantity.
2. In general, an auto insurance company will classify sports cars and other flashy, high-performance vehicles as high risks, because statistically their owners tend to drive more recklessly than people who drive sedans and station wagons. What’s more, their conspicuousness makes them tempting targets for thieves and vandals. If you own such a vehicle, be prepared to pay a substantially higher premium.
   
   Sport utility vehicles are also unpopular with insurance companies. Pedestrians hit by SUVs have a 300-percent higher risk of serious injury than if they were struck by a passenger car. There's also greater injury to people in cars hit by SUVs as compared to cars struck by another car. As a result, SUV owners typically pay 10 to 20 percent more for insurance.
3. Typically, an auto insurance company has the right to review the driving record of anyone who applies for a policy from that company. The company wants to determine whether you meet their standards of insurability and to evaluate your risk potential. Each company has its own evaluation method, so the points on your driving record may or may not have a direct impact on your rate.

The more you know about your auto insurance, the better prepared you’ll be to negotiate a favorable premium.