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Louisiana Auto Insurance Rates

Factors That Affect Your Louisiana Auto Insurance Rates

Auto insurance rates in Louisiana have steadily climbed to claim the highest rates in the nation since Hurricane Katrina. Why?

Well, one theory is that Louisiana has a more "litigious society" than surrounding areas because of its direct-action law. People are more likely to sue in Louisiana than in other states, which drives up rates.

Auto insurance rates are different for everyone depending on a lot of different factors. In general, policyholders are put into different “risk pools” based on statistics for specific populations. A policyholder’s risk factor is determined by all sorts of data, including their gender, driving experience, stated reasons for driving the specified vehicle and more.

What are some major factors in determining an auto insurance rate in Louisiana?

• Vehicle Classification
• Age
• Marital status
• Mileage driven per year
• Previous accidents and claims
• Driving record
• Credit score and
• Zip code.

A lot of details determine a vehicle’s risk classification. It is one of the most important factors in determining an auto insurance premium. A vehicle is classified based on its performance capability and its retail cost. The higher the performance capability, the higher the risk factor because better performing vehicles are capable of going faster and more aggressive maneuverings than lower performing vehicles. Thus, higher performing vehicles are capable of causing more significant accidents and damage to other vehicles. A car that has a high market value costs insurers more to replace, so that also increase insurance premiums. Vehicle risk classification is also determined by statistics measuring the number of thefts, accidents and repairs per year for each car.

Age is also one of the highest factors that affect your insurance rate. Statistics show that drivers under the age of 25 cause the highest percentage of car accidents, while drivers between the ages of 50 and 65 cause the lowest percentage. Therefore, auto insurers charge higher premiums to younger drivers because that specific population costs the most insurer pay outs. Those between 50 and 65 are put in a lower risk pool because they statistically cause insurers to pay out less.

Policyholders who are married tend to have lower insurance rates. This is because marriage is often considered an indicator of financial stability and insurers believe they are more likely to reliably meet their payment obligations.

Some policies are determined based on the average distance that the car will be used on a normal day. The premium may also be affected by the annual mileage put on a vehicle and for what purpose. Usually, the mileage is provided by the insured person, but some insurance providers request this information before determining a policyholder’s risk.

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