Although required by law when financing or leasing a vehicle, the majority of your customers will want automobile insurance for their vehicles.  For many drivers, the high cost of insurance can pose a hurdle for a dealer to make a deal or for a customer to take delivery of a vehicle. Because this is an important element in the sales process, dealers need to have access to many insurance companies that can meet the needs of its customers

Computers establish a client's risk profile and then compares it with historical records in the insurance company's database. Since the laws that regulate insurance are set at the provincial level, the province in which you live is the most important factor in determining the cost of car insurance. The population density, number of drivers and vehicles on the road all go into the calculation for determining a premium. The primary factors that affect insurance rates are age, gender and marital status. Secondary factors include the driving record, where you live and the year, make and model of your car.

Through the insurance companies' data, they know that 16 to 24-year-olds are in a disproportionate number of accidents. People 25 to 49 are in fewer, and people 50 to 64 are in the fewest of all. But starting at age 65, people begin getting into more accidents. By the time they hit 75, they are more commonly in accidents than even teenagers! Women are in fact in fewer accidents than men. Gender is most important in the cases of people under 25, with young males being in far more accidents than young females. This risk can be partially offset, surprisingly, by marriage. Married men ages 18 to 24 are in far fewer accidents than their single peers. The insurance companies also believe that if you've had one accident, there is a great likelihood you'll be in a second. If you're in a second accident, there's an even greater likelihood that you'll be in a third. And if you're in a third, fourth, or fifth accident in a short period of time, your insurance rates are going to go through the roof.

If you can identify the demographic profile of your client base, you can research insurance companies that will provide better solutions for each profile. This will allow you to make more deals and gross profit, improve customer satisfaction and have a competitive edge over your competitors who ignore this business element.