When you search for the cheapest car insurance you often need a deeper understanding of the mechanisms behind the pricing of insurance policies. But at the same time the basic principle of price formation in insurance is very simple - the lower is the probability that the customer will file a claim the lower will be the price for any type of insurance services. In car insurance it's usually about reducing the risk of having an accident, as it's the most common cause for claim payouts. However, there are other risks car owners seem to forget about, missing out on a good opportunity to get the cheapest car insurance policy. We're talking about car theft risk.
The costs of car theft
Statistics indicate that the current vehicle rates are the lowest
during the last four decades and dropping on a yearly basis. However,
there are still hundreds of thousands of cars stolen in the USA every
year. Almost half of these vehicles are never retrieved, which means
that insurance companies have to cover the losses to customers who have
comprehensive coverage, accounting for billions of dollars every year.
Naturally, the insurer will always be sensitive to the car theft risk
associated with a particular. And if the vehicle is likely to be stolen
than the average will have higher rates even if owned by a good driver
with no claim history. So if you want to get the cheapest car insurance
you have to make sure that your car has a low risk of being stolen.
Addressing the risk
There's a huge variety of vehicle anti-theft devices to choose from.
From simple devices like wheel locks and bars to sophisticated
alarm-systems and state-of-the-art tracking modules, the only limit is
your budget. But apart from the obvious solution of equipping your car
with an anti-theft device there are other measures that will also help
to reduce the risk of theft:
- Keep your vehicle in the garage
- The car should always be locked when you're out
- Don't leave the car in a dark area
- Make sure there are people walking by the parking lot
Cutting insurance costs
Some factors aren't that easy to control when it comes to car theft
risk. If there is a high crime rate in your area then you will always
have to pay more for insurance unless you double the efforts for
securing your vehicle. Another factor that will make it hard to obtain
the cheapest car insurance is having a car model that is stolen more
often. In such a case the only solution is switching the car or place of
residence, which will surely help you reduce the cost of insurance.
Obviously, that's not an option for most customers. So you should try
best to improve the security of your vehicle and make it as theft-proof
as possible in order to get more affordable insurance in current circumstances.