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Insurance Definition: AUTO INSURANCE PREMIUM

By Compuquotes Team on March 27th, 2008

AUTO INSURANCE PREMIUM:

Definition:

  • The price an insurance company charges for coverage, based on the frequency and cost of potential accidents, theft and other losses. Prices vary from company to company, as with any product or service.

Premiums also vary depending on the amount and type of coverage purchased; the make and model of the car; and the insured's driving record, years of driving and the number of miles the car is driven per year. Other factors taken into account include the driver's age and gender, where the car is most likely to be driven and the times of day - rush hour in an urban neighborhood or leisure-time driving in rural areas, for example. Some insurance companies may also use credit history-related information. (See Insurance score)

Information provided by Insurance Information Institute

See average annual insurance rates for more than 2,000 vehicles

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