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police car with lights on, the effect of crime rate on auto insurance

Why your area’s crime rate affects your auto insurance rates.

When insurance providers calculate your auto rates, they will take several factors into account.  Some of these factors are considered “non-driving” factors, meaning they are not related to your vehicle or driving record.  Non-driving factors include things like your gender, marital status, and the crime rate in your area.  But why does something like crime rate impact your car insurance?  Here’s what you need to know.

Crime Rate by Zip Code

Car insurance providers use your zip code to check up on the crime rate in your area.  This is why they ask you to provide your zip code on your auto insurance quote request form.  Insurers are looking for specific, car-related crimes such as the following:

  • Vandalism
  • Break-in
  • Car theft
  • Accident rates
  • Fender benders
  • Hit and runs

How Crime Rates Affect Your Insurance

Auto insurers calculate your rates based on how likely they think you are to file a claim.  The more likely they think you are, the higher your rates will be.  When you live in an area with high crime rates, auto insurers automatically assume that you are at greater risk for having your car vandalized, stolen, damaged in a hit-and-run, and so on.  Because you would file an insurance claim for these issues, auto insurers look to protect themselves by raising your rates.

On the fortunate side, if you live in an area with lower crime rates, then you will have access to lower auto insurance rates.  This is because the insurer assumes that you are at lower risk for experiencing a claim-related event.

This is why your area’s crime rate affects the cost of your auto insurance.  Do you have additional questions about your car coverage?  If so, then contact the experts at The Schwab Agency in Colleyville, Texas.  We are ready to assist you with all your car coverage needs today.

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