How is the cost of car insurance worked out?

How is the cost of car insurance worked out?

Car insurance covers you for costs in the event of an accident or claim that is covered by your policy in exchange for you paying an insurance premium. The amount you pay for your premium is based on your personal risk level. The answers you give to a series of questions will be entered into our database and the statistics will be compared to other people who match your profile in order to calculate your premium. Here are some of the key factors that help determine your level of risk:

• The driver's age
• The make and model of your vehicle
• Annual mileage
• Whether the driver is male or female
• Where the vehicle is kept overnight
• The suburb or town where the vehicle is kept
• Whether the vehicle is privately owned or financed

By providing answers to these questions, we can accurately predict how much of a risk you are and ensure you are not paying for other people’s mistakes.

The cost of your premium also depends on the amount of excess you are willing to pay in the event of a claim. In general, premiums will be higher if a lower excess is selected, and vice versa.