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Praying for better car insurance rates? Move next to a church
You don’t have to pray for lower car insurance premiums. You don’t even need to attend church. But statistics show that simply living near a church or other religious institution reduces your risk of getting into a car accident — and that could lead to better car insurance premiums than your friends have.
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Quality Planning, an ISO company that validates policyholder information for car insurance companies, conducted a study that concluded that people who live within a mile of a religious institution are 10 percent less likely to have a car accident resulting in property damage. The study, which examined more than 15 million policyholders and two million claims, also found that living near a restaurant increases your chances of getting into a car accident by 30 percent.
"A restaurant is intentionally located in a higher traffic area. You got a lot of cars coming in and out," says Bob U’Ren, senior vice president of Quality Planning. "Churches are typically in a more open area or a [less congested] neighborhood. So, maybe with the exception of Sunday, the church doesn’t attract a lot of traffic."
 Accident hot spots
The percentage shows how much more likely you are to get into a car accident if you live within one mile of the establishment.
Source: Quality Planning Corp. |
Where you live has always been an important factor used by car insurance companies to calculate your premium because it impacts your risk for car accidents. Traditionally, insurers have used ZIP codes to determine this risk. Other variables that affect your premium include your driving record, claims and credit history, age, gender, type of insurance you purchase and the type of car you drive. But it’s becoming more common for insurers to use technology to better understand your geographic area (like if you live close to a church or a restaurant) instead of simply using your ZIP code.
ZIP codes "are great for delivering mail, but not for writing insurance," says U’Ren. "That’s because of the diversity possible within a ZIP code."
But using technology to assess risk at a specific street address is a major breakthrough for car insurance underwriting and allows insurers to more accurately price their products, U’Ren says.
"It’s a sort of ‘new frontier’ to determine an insurance premium," he adds.
Gas stations are another accident hot spot. Quality Planning found that if you live within one mile of a gas station, your probability of making a physical damage claim is 22 percent higher than somebody who lives more than one mile away from that same gas station. You may live on the same road as that other person, but if you are closer to the gas station, your risk is higher.
Other risky areas are grocery stores, elementary schools, banks, car dealerships and liquor stores. Places that have shown the lowest risk include racetracks, amusement parks, hotels and resorts, parks and forest preserves, airports and medical clinics (see sidebar). Some of these results surprised even the folks at Quality Planning.
But U’Ren says the results make sense if you analyze them further. "Let’s compare an airport to an elementary school. The airport is designed to handle heavy traffic. It has [multiple traffic] lanes, off ramps, etc. An elementary school has a small driveway and it’s not designed to handle traffic," he says, resulting in greater potential for playing "bumper cars" at peak times.
All things considered, you’re safest bet is to live more than one mile away from these establishments, with one exception: Living near a church actually decreases your chances of an accident. Godspeed!
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