Auto Insurance Ratings Rising in Some States, Falling in Others

Bedford -- Free-Press-Release.com-- Dec 2, 2011 -- State Farm’s recent, slight increase in overall rates for New Hampshire car insurance—and decreases in overall premiums in other states—makes clear the important role that location plays in helping to determine how much consumers pay for auto policies, according to Online Auto Insurance (OAI).

Coverage providers look closely at the geographical location where a policyholder resides—and the likelihood of claims for damage, theft and other losses—as a way of calculating how great a risk they are taking by insuring a motorist.

That’s what State Farm did last month, when it announced it is trimming overall rates for its Pennsylvania customers by an average of more than 1.2 percent. That adjustment, which takes effect in late December, is expected to save customers statewide more than $16 million.

That came on the heels of other rate-cut announcements. The insurer reported it is reducing overall rates for its Alabama customers by 2 percent on average and for Georgia policyholders by an average of 2.2 percent.

Company officials said the decreases were prompted by a reduction in the number of damage claims filed by policyholders and the dollar amount of those claims.

Industry experts say insurers set their premium prices in order to cover the cost of future claims and administrative expenses and to leave room for a profit margin.

Source: http://www.cga.ct.gov/2006/rpt/2006-R-0542.htm

While policyholders in several states have gotten good news about their premiums, however, State Farm in August implemented a 0.2 percent overall rate increase for its New Hampshire customers.

Company officials called the hike is a minor one and said the amount policyholders pay each month will continue to be affected by other factors, including the types of coverage they buy and any discounts they may be eligible for.

Where a policyholder lives has a major effect on premiums. But there are other important factors as well, including driving record, annual mileage, age and gender, and the type of vehicle driven.

To learn more about this and other coverage issues, readers can go to http://www.onlineautoinsurance.com/new-hampshire/ where they will find informative resource pages and a rate-comparison generator that can help users quickly evaluate their coverage options.

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Online Auto Insurance
Gregor McGavin
http://www.onlineautoinsurance.com/