Regardless of a person’s age, he or she will need to have car insurance when starting to drive. Most people get their license when they reach age 16, and most of those young people will be on their parent’s insurance for a few years, at least until they graduate from high school. When parents add their children to their insurance policy, they can expect that their rates will go up. If the youth is going to drive though, they need to have insurance that will cover them in case of an accident.

While it might be more expensive for the new driver to get insurance on his or her own, it might be a good idea. The parents will still be able to help to pay for the insurance, but they will not be on the same policy, and this means their children will not affect the parent’s insurance. This is a winning situation for everyone. The young drivers learn about the responsibility of having their own insurance, and the parents do not have to worry that their rates will skyrocket.

Some vehicles can cost fifty percent more to insure. Rates can vary by year, make, model, and sub model. It will always be in a consumer’s best interest to shop their auto insurance rates prior to purchasing a new vehicle. Prices are generally higher on two door models compared to four door cars. High performance is also a large factor in determining the premium for your policy. Historically, a larger percentage of high performance vehicles have been involved in accidents when compared to vehicles that are not high performance vehicles, thus driving the insurance rates up.

Rates also increase depending on the cost of the vehicle. Whenever you have comprehensive or collision coverage on your policy the rates will parallel the cost of the vehicle. It is understandable that the insurance company will need to collect a higher premium for more expensive vehicles since in the event of a loss the insurance company will be on the hook for the value of the vehicle.

Recently, a specialized rating system was developed to assess vehicles according to the probability they would be involved in insurance claims. Additionally, it took into consideration the price tag on resolving those insurance claims. This system currently is used by car insurance companies throughout all provinces. It is called the Canadian Loss Experience Automobile Rating, or CLEAR, system. It may have a considerable impact on your rates.

Eventhough many drivers are aware the CLEAR system impacts their car insurance rates, few understand how it works. We are going to explain this matter here. Before we do, however, it’s worth taking a closer inspection at the factors why CLEAR was created in the first place.