What affects your auto insurance policy and the price you pay?

Take the time to find the right auto insurance. If you're going to take the time to compare two tomatoes in the supermarket to get the best one then why wouldn't you take the time to compare auto insurance quotes to get the best deal?

There are many factors that influence the price you pay for auto insurance and whether you can get cheap auto insurance or not. The average American driver spends about $700 a year. Your premium may be higher or lower, depending on the following:

Your driving record.

The better your record, the lower your premium, and the better auto insurance quote you will get. If you've had accidents or serious traffic violations, you will pay more than if you've had a clean driving record. You may also pay more if you haven't been insured for a number of years.

The number of miles you drive each year.

The more miles you drive, the more chance for accidents. If you drive a lower than average number of miles per year, less than 10,000, you will pay less. For instance, some companies will give discounts to policyholders who carpool.

Where you live.

Insurance companies look at local trends, such as the number of accidents, car thefts and lawsuits, as well as the cost of medical care and car repair.

Your age.

In general, mature drivers have fewer accidents than less experienced drivers, particularly teenagers. So insurers generally charge more if teenagers or young people below age 25 drive your car.

The car you drive.

Some cars cost more to insure than others. Variables include the likelihood of theft, the cost of the car, the cost of repairs, and the overall safety record of the car.

The amount of coverage.

Of course, like anything else, the more coverage you have, the more you pay. However, you may qualify for discounts.

Some types of coverage.

Mandatory Coverage:

Some states require that you carry No-Fault insurance if you're the owner of a car or truck licensed for road use. Here are some of the major features of this coverage.

Personal Protection Insurance

Pays for your personal injury expenses and losses if you're ever hurt in an automobile accident. It also covers family members who reside in your household and passengers riding in your vehicle who are not covered by similar insurance.

Within certain limitations, Personal Protection Insurance pays for virtually all your medical and hospital costs. For a period of up to three years, it can pay for the income you lose as a result of your injuries, and for the financial support your dependents require should you die from your injuries.

You can reduce the cost of this coverage by coordinating benefits with your current health insurance or income protection plan (if you're covered by one that coordinates with your no-fault insurance).

Property Protection Insurance

Pays for damages, regardless of fault, done by your car to properly parked vehicles or fixed properties such as buildings or lampposts. Damage to your own property is not covered.

In some states your legal liability for property damage is covered by Residual Property Damage Liability Insurance.

Residual Liability Insurance

Pays when you are legally liable for unintentional bodily injury and also covers property damage to others.

Minimum coverage limits on mandatory No-Fault insurance are set by law. Higher limits are available on selected coverages at additional cost.