How are car insurance premiums calculated?

Find out what factors go into determining the cost of your car insurance

Once you're behind the wheel of the car you were looking for, one of the next and most important steps is buying car insurance. This product will not only allow you to drive with peace of mind, knowing that you are covered against any type of accident or injury, but it is also required by law. There are many types of insurance and, therefore, many different prices too. It is therefore essential to understand the factors that determine the cost of an insurance policy in order to take out the most suitable one. Discover with BBVA how the price of a car insurance policy is calculated and enjoy the road worry-free.

When it comes to assessing which car insurance suits us the best and choosing the most appropriate price, we should take into account the same aspects that are considered by the companies that determine the price of the policy. There are different factors, but all of them are based on three key areas: the driver, the car itself and how it will be used.

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The profile of the driver

The person who will drive the car, or rather their profile, is a key factor in establishing the price of an insurance policy. Given that we are all different, there is no such thing as a standard insurance policy and the product is always personalized. While it is true that companies structure their products according to particular groups, the policy you take out is always an insurance drawn up - and calculated - specifically for you. The age of the driver, together with the driver's experience, will determine, to a large extent, the cost of the insurance. The older a driver is and the more experience they have, the less likely they are to be involved in an accident, hence the cheaper their premium will be.

This explains why young people with limited experience (until they accumulate ten years with a driver's license) initially have to pay much higher premiums, although the situation does change over time as drivers accumulate years without making any insurance claims. People over 65 years of age also have higher premiums, due to factors that affect driving such as deteriorating vision and the use of mediation.

In this regard, the driver's record is also essential. Someone who has not had to make any claims for several years will have access to a much lower premium, and equally, somebody with a track record with many incidents and claims will have a higher premium. Not only will this be an important factor in our own insurance company's calculation of the premium, but if we decide to change insurance provider then our claims history will also have repercussions on the price that other companies offer us.

Statistics have always shown that women have fewer accidents than men, although since 2012, following a change in European Union law, this factor can't be used to determine the cost of car insurance. Even where we live influences the price of the premium. Statistics and studies show that there are places where accidents are more likely to happen than others. This all depends on factors like the profile of the drivers themselves, the condition of the roads and the amount of traffic congestion.

The car

It may seem obvious, but the characteristics of the car being insured are crucial when estimating the cost of the insurance. A 70-HP sub-compact isn't the same as a 150-HP sports car, and the power will directly influence the amount of the premiums. The more powerful a car, the higher the price of the insurance, as more powerful vehicles are more likely to be involved in an accident.

In this regard, the make and model of the car are also decisive. Besides the fact that a sporty car has a higher premium than a utility vehicle, it also has more expensive components. when determining the value of a premium, the insurer studies in detail how much it would cost to repair the vehicle in the event of a claim, or to replace it following a theft.

Another essential aspect to consider is the age of the vehicle. In general, we always try to ensure that a new vehicle has greater protection than an old one. In fact, the usual practice is to always take out fully comprehensive insurance for vehicles that have just recently left the dealership. Having an unlucky incident with a recently purchased car and not having adequate insurance to cover such a situation can lead us to regret not having invested more: in this type of case, what appears to be cheap can turn out to be expensive in the long run.

The use of the vehicle

The third criterion that determines the cost of the insurance is how the automobile will be used. Once again, there are two main categories that must be taken into account: whether the vehicle will be for personal or business use. The premium will be higher if the vehicle is to be used for professional purposes, since the car will be used more often and with higher demands than in the case of a private individual.

This all really has to do with the number of kilometers traveled, since statistically it is more likely to be in an accident than a car that is used less often. Moreover, it will have more opportunities to suffer breakdowns and unforeseen events.

And don't forget that having a garage is also in your favor. If your car is parked undercover every night, your insurance will be cheaper, whereas if it is parked on the street at night, the premium will increase since the risk of being the subject of a claim - particularly due to theft - increases considerably. Investing in renting or buying a garage to keep our car safe and saving on our insurance policy can, therefore, be a good idea.

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An insurance policy tailored to suit you

If you're looking for the most suitable insurance policy for you, visit to check our range of policies and choose the one that best suits your needs. Whether it's a comprehensive or third-party insurance, at BBVA you can take out your car insurance up to 9 months before your current policy expires and enjoy attractive benefits:

  • Public liability insurance as a pedestrian or cyclist.
  • Legal assistance.
  • Travel assistance.
  • Door-to-door services.
  • Free choice of repair shop.

The BBVA Car Insurance Assistance app will also be available so you can manage your insurance with just one click. Check the BBVA website, choose your type of policy and travel worry-free. And remember that you have at your disposal the EstarSeguro Plan, which you can use to save on your insurance policies by grouping them together and paying for them monthly at no extra cost. The more insurance policies you take out and add to the plan, the more you will save.

Insurance companies: Product 50% co-insured, respectively, by BBVA SEGUROS, S.A., DE SEGUROS Y DE REASEGUROS, listed in the registry of the Directorate-General for Insurance and Pension Funds under number C-0502, and LIBERTY SEGUROS, COMPAÑÍA DE SEGUROS Y REASEGUROS, S.A., registered with the Directorate General of Insurance and Pension Funds, with password C-0467.

Broker: BBVA MEDIACIÓN, OPERADOR DE BANCA-SEGUROS VINCULADO, S.A., listed in the Special Administrative Register of Insurance Brokers of the Directorate-General for Insurance and Pension Funds under registration number OV-0060. With public liability insurance arranged and sufficient financial resources.

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