Insurance companies underwrite a policy based on certain factors. Where a person lives and/or where a vehicle is used is the territory assigned.

Certain areas of cities have more affluent people in the population. So a certain postal code may receive a better rate for home insurance. That same company may surcharge another less desirable postal code residence.

If a commercial vehicle is used in a territory which generates a higher premium then the usual procedure is to charge for that higher territory.

Automobile insurance in rural areas is usually less expensive due to fewer cars and thus fewer claims. Property insurance in rural areas is usually more expensive since there is not often a full time fire department available to respond to fire alarms.

It is not uncommon to have an incorrect territory on a policy. People move quite frequently and this is something that could be overlooked during the underwriting process.

Check with your broker that you are receiving the best rating for your use and location.