The law requires at least liability insurance for all drivers and vehicles. This means that if you are involved in a serious accident, and it turns out that it was your fault, your insurance company will pay out any claims that are made against you.
The way it works is the more they feel you are at risk of crashing, and the more they think the resulting crash will cost them, the higher the premium you’ll pay.
Common factors that will determine the premium are; the value of the car you’re driving, the safety of that vehicle, the coverage you want; will there be deductibles or limits etc.? How much you’ll drive the car, how your driving record stands, how long you’ve held your license, your age, and if you are young, also your sex.
The premium is then calculated. Usually there is a flat per car, per year rate that everyone pays, regardless of other factors. The other factors will then alter this rate, generally upwards. So if your car is especially fast or dangerous your rate will be increased by a set amount. If it is very old, your rate goes up. If you’ve had one or more accidents in the past, your rate will go up. If you’re young and male, your rate will go up. The more of these factors you satisfy, the more your rate will be going up.
Most companies offer discounts to safe drivers, multiple vehicles, safety devices and anti theft devices.
The best way to save on car insurance is to shop around, keep a good clean driving record, drive safely, and choose reliable cars not necessarily high priced sporty cars!