Car insurance calculator: how does it work?

By | December 24, 2022
Car insurance calculator

When you ask for quotes for your car insurance, you are not sure how the price is calculated… Find our explanation in 4 points. Many criteria come into play for the calculation of a car insurance. It is difficult to go into detail because each insurance company has its own calculation rules based on statistics. However, there are some common elements to make this calculation. And one principle: the higher the risk, the more you pay!

#1. Your vehicle

Every detail is important: make, model, body type, power… For example, a powerful car is statistically more often involved in an accident. Its insurance premium is therefore more expensive! The traffic area also influences the rate: if you drive mostly in urban areas, the risk is higher. The same goes for the parking place: if your car “sleeps” in the street, it will be more easily stolen or vandalized than if it is sheltered in a garage. Finally, if you also use your car for business trips, you are more likely to have an accident than if you only use it on the weekend…

You should also know that ecological qualities are rewarded: for an electric car, you can benefit from a discount of about 30% on your premium (at AXA).

#2. Your profile

This time, it’s about you: your age, your family situation, your status as a primary or secondary driver… For example, if you are a young driver, you are more likely to cause an accident. A surcharge is applied to “novice drivers”, i.e. those who have no driving experience. But it is reduced if you have been accompanied by a driver.

#3. Your history

Your driving history is also taken into account: the date you obtained your license, the number of years without an at-fault accident, the accidents you have had, your bonus-malus… The objective is to measure the degree of risk you represent before calculating your car insurance premium.

Moreover, for certain serious past events, an insurer can apply in addition a premium increase: driving under the influence of alcohol, suspension or cancellation of license, hit and run, non declaration of accidents…

The effects of the bonus-malus on the calculation of the car insurance

Before the anniversary of your contract, your bonus-malus coefficient is modified for the following year according to the declared accidents for which you were responsible in the last 12 months:

– It is reduced if you have not been responsible for any accident.

– It is increased if you were responsible (or partially responsible) for at least one accident.

#4. Your level of coverage

Finally, the number of coverages you need, as well as the assistance services, are of course important. The more comprehensive your coverage, the higher your premium. So, an “all risk” insurance will always cost you more than a third party insurance… But you will be better protected!

Calculate the car bonus malus

The bonus malus is a system fixed by law. Since 1976, it is compulsory for all insurers in USA. Discover how it works.

How does the bonus malus work? 

The objective of the bonus-malus is to reward or penalize the insured drivers according to their behavior, by influencing the rate of their car insurance upwards or downwards at each annual deadline. The car bonus-malus coefficient starts at 1 and is reduced by 5% each year without an accident. Conversely, it is increased by 25% in the event of an at-fault accident.

Bonus-malus and car insurance

Each car and motorcycle insurance contract (vehicles over 125 cm3) includes a clause for reducing or increasing premiums or contributions. This clause specifies that the amount of the insurance premium of a driver is calculated according to his claims of the previous year. The more responsible accidents the insured has, the higher the premium (malus). Without an at-fault accident, the premium decreases (bonus). The premium thus depends on the level of risk.

Through a statement of information, any insured can know the level of the bonus-malus of his car insurance, also called coefficient of reduction-majoration (CRM), and follow its evolution year after year.

How the bonus malus is calculated

  • The bonus-malus coefficient starts at 1 and can vary between 0.5 after 14 years of insurance without responsible accident and 3.5 after several responsible accidents.
  • An insured person gains 5% bonus for each year of insurance without an at-fault accident.
  • For each at-fault accident, an insured’s bonus-malus coefficient will increase by 25%.

If you have difficulties to insure yourself through the classic car insurance, note that there are car insurance malus that can allow you to get back on the road safely.

How to know your bonus malus ?

The bonus malus is mentioned on each expiry notice of your contract. You can also ask your insurer directly for the bonus malus of your car insurance.

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