How much is the car insurance rate? Types of Insurance, Pricing Structure, and Saving Points

Even if you drive carefully, unfortunately accidents and troubles may occur. Auto insurance is an important insurance that will support you in case of such an emergency.

How much is a reasonable car insurance premium? In this article, we will introduce you to the points that determine the price and price of car insurance. Knowing how auto insurance works and what it covers is important for choosing the right insurance for you. We’ll also give you tips on how to save money on car maintenance.

Do I have to pay for insurance if I drive a car?

Buying a car is one of the biggest household purchases. Not only the purchase cost, but also the maintenance cost after purchase should be considered in advance. Car insurance, which is one of the maintenance costs, requires a lump sum amount for a certain period of time. Find out if you should pay.

car insurance types

There are two types of car insurance. One is compulsory automobile liability insurance, which is compulsory for car owners. This is stipulated in the Automobile Liability Security Law.

The aim is to secure basic interpersonal compensation by compensating for the economic burden of the assailant in order to provide relief to victims of automobile accidents. You must pay the liability insurance premium.

The other type of insurance is voluntary insurance, often called auto insurance. Voluntary insurance coverage is not stipulated by law.

Necessity of Voluntary Insurance

Auto insurance generally refers to voluntary insurance. Voluntary insurance is a contract for insurance that will be paid in the event that you or others suffer damage due to an accident or trouble involving a car.

Compensate for the parts that cannot be covered by the compulsory automobile liability insurance taken up in the previous item. For example, if you hit a parked car, or if you hit a pedestrian while driving a car and killed or injured. Depending on the terms of the contract, the insured will also pay for damage to your own vehicle.

What is the guideline for voluntary car insurance premiums?

There are many insurance companies that offer auto insurance. Also, you may have noticed that there is a large difference in the price of insurance premiums due to various contract contents. Let’s take a look at common car insurance rates. Please check the details on the insurance company’s official website, etc. according to your own situation.

Insurance premium rate

Auto insurance premiums are around 50,000 yen per year. The amount to be insured varies considerably depending on the person, but some people pay less than 25,000 yen a year, while others pay more than 90,000 yen. On average, the result was that most people spent 30,000 yen or more and less than 70,000 yen.

There are various factors that determine insurance premiums, but basically, the higher the coverage and coverage, the higher the premium. When a large number of people share a single car, the warranty coverage is set broadly, so the charges tend to be high.

The amount varies depending on the risk.

In recent years, most auto insurance companies have adopted a premium calculation method called “risk segmentation type”. If the risk of getting into an accident is low, the insurance premium will be low, and if the risk is high, the insurance premium will increase, depending on the driver and vehicle conditions.

There are various methods for calculating the risk of encountering an accident, including past accident history. The factors that determine risk and the main points that determine insurance premiums are explained in the following items, so please refer to them.

Factors that determine car insurance premiums

Auto insurance costs vary from person to person, but what factors make the price difference? Knowing your insurance premium breakdown will help you decide what you need. Here are seven factors that determine car insurance premiums.

 

car model

Insurance premiums vary depending on the make and model of the vehicle. As a general rule, the higher the safety performance of a vehicle, the lower the insurance premium, because the difference in the safe driving support functions such as automatic braking will affect the likelihood of an accident occurring.

 

The use of cars is divided into three types: “daily/leisure”, “commuting/commuting”, and “business use”. In order of “business use” > “commuting / school” > “daily / leisure”, the car usage rate is high, and the risk of accident increases, so the insurance premium is also high.

 

Rate class by model

The difference in insurance premiums depending on the model of the car is called “premium rate class by model”, and it is determined so that the insurance premium burden rate is fair based on the past accident occurrence situation for each model. Vehicles that have had many accidents in the past will have higher insurance premiums.

 

Private passenger cars are classified into classes 1 to 17, and the lower the number, the lower the insurance premium, and the higher the number, the higher the insurance premium. For light vehicles, there are three levels of classification from Class 1 to Class 3.

 

age

According to past statistics, insurance premiums are higher for age groups with higher accident rates. Insurance premiums are higher for people in their 20s, who have not had a driver’s license for a long time and are often immature in driving skills. You can

 

Insurance premiums may be cheaper for people in their 50s who have many gold license holders. Past statistics show that accidents with cars over 70 are more likely to occur, so insurance premiums generally rise from this age group. In this way, insurance premiums are determined based on past accident trends for each age group.

 

grade

Automobile insurance subscribers are individually graded according to the number of past accidents and the number of accident-free years, and the higher the grade, the lower the insurance premium. Grades range from 1st to 20th, and will be set to 6th immediately after joining. The higher the grade, the longer the period without insurance payments, the lower the insurance premium.

 

When you cause an accident and the insurance pays out, the grade goes down and the insurance premium goes up. The degree of decrease in grade varies depending on the type of accident and the number of occurrences, and is not uniform. In addition, grades are standardized across insurance companies, and even if you change insurance companies, the grades of the previous insurance company will be inherited.

 

whether the car is new

Automobile insurance has a new car discount system, and you can receive a discount on insurance premiums for a certain period from the first registration date (first inspection date for light vehicles). In recent years, many insurance companies have set the new car discount system to be applied for 25 months, and discounts can be used even for used cars within that period.

 

Some insurance companies do not offer new car discounts. Even insurance companies that offer discounts do not cover light vehicles, so be sure to check before applying.

 

Set insurance amount

Premiums vary depending on the amount insured and its deductible. The insured amount is not freely determined by the insured. The range of the insurance amount to be set is determined by the model and year of the car, and it is customary to set it within the range of the range.

 

The deductible amount indicates the self-pay amount of the repair cost of the car, and the higher the deductible amount is set, the lower the basic insurance premium is. You should base your decision on how much you can afford to pay out-of-pocket.

 

driver range

The more people driving the car than the policyholder, the higher the insurance premium. The range of drivers is “unlimited” with no limiting conditions, “family limited” including relatives who live together and unmarried children living separately, “married couples only” for the policyholder and his/her spouse, and only the policyholder. There are basically 4 types of “personal only”. The wider the coverage, such as “no limit”, the higher the insurance premium.

 

Even if a person outside the coverage area drives a car and causes an accident, it will not be covered. If you say “I will never drive other than myself”, you can set it to “Limited to yourself” to reduce insurance premiums.

 

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You should definitely put it on! Recommended compensation

Auto insurance offers a variety of coverages, so you may be wondering which coverage you should get. Especially for first-time car insurance policyholders, there are many people who are confused about what kind of compensation is available. Here, we will explain the contents of compensation that you should definitely add.

 

vehicle insurance

Automobile insurance is insurance that compensates for the repair costs when a car is damaged. We also handle cases where the car is damaged by mischief or stolen. It also supports damage caused by some natural disasters, and will greatly reduce the burden of damage to your car.

 

There are different types of car insurance. There is a “wide coverage type” that compensates for damages such as hit-and-run that the perpetrator cannot be identified, and a “limited coverage type” that does not cover these. In addition, the payment amount differs for a total loss and a partial loss.

 

Own accident insurance

A self-inflicted accident is a traffic accident for which the policyholder is responsible. Accidents involving property damage where no one was injured or killed, such as hitting a telephone pole or fence, and accidents in which the other party was not at fault, such as hitting a parked car, are also covered.

 

In both cases, the driver is fully responsible for the accident, and even if the driver or passenger is injured, bodily injury liability insurance will not apply. If you have personal accident insurance, you will be covered in such cases.

 

uninsured car accident insurance

Uninsured car accident insurance is insurance to receive sufficient compensation even when an accident occurs with a car that is not covered by voluntary insurance. If you are not enrolled in voluntary insurance, there are cases where you cannot receive sufficient compensation even if you cause an accident. can be

 

Even if the other party has a voluntary insurance contract, if the driver does not meet the age requirements, it will not be covered by voluntary insurance. Even in such cases, you can receive sufficient compensation, so you can drive with peace of mind if you wear it.

 

Attorney special contract

Lawyer special contract is an insurance that covers the expenses incurred when you have an accident and need to consult a lawyer.

 

You can delegate negotiations to a lawyer not only when the contractor himself causes an accident, but also when a settlement is necessary due to an accident. In cases where you are not at fault, you cannot consult with your insurance company, so you will have to pay the attorney’s fees and consult with them, which is also useful in such cases.