Accidents

The repercussions of being in an accident can be widespread and linger for years, impacting your physical health, mental well-being, and financial state.
Insurance premium increases often are one of the unfortunate side effects. But, whether your rates will go up―and how much they do―following an accident depends on a variety of factors including your driving record, claims history, insurance carrier, accident severity, and circumstances of the accident. (more)

Age

Statistics carry the most clout with insurance companies for establishing rates. This proves especially true with ages. Evidence collected over the years reveal which age groups are most susceptible to accidents. So if you're currently in an age group that's factually proven as high risk, you'll face higher premiums.

For example, insurance companies often charge drivers between the ages of 16 and 23 with high rates based on statistics. (more)

Auto Theft

Auto theft is the No. 1 crime in the United States. The FBI's Uniform Crime Report reveals a motor vehicle is stolen in the United States every 28.8 seconds.

It's not just people with brand-new vehicles who need to worry about auto theft. In many cases, an older car can be more valuable when it's chopped up and sold for parts. (more)

Credit Score

Credit scores can work for or against you. For example, if you miss a couple payments on a credit card, your car insurance rates could go up. On the other hand, if you have great credit, you could see a discount. This is because insurers figure those with worse credit are a worse risk.

Credit scores can work for or against you. For example, if you miss a couple payments on a credit card, your car insurance rates could go up. On the other hand, if you have great credit, you could see a discount. This is because insurers figure those with worse credit are a worse risk. (more)

Driving History

Insurers assess risk, and if your driving history contains numerous examples of poor judgment and unsafe driving habits, most providers will view you as an unattractive customer, and may either refuse to provide coverage or do so at an exorbitant rate.

Traffic ticket violations range from failing to insert a quarter into a meter and receiving a parking ticket to being caught driving drunk. Accordingly, insurers view each traffic violation as a measure of your risk profile. (more)

Gaps in Coverage

Simply put, carriers view individuals who frequently let their insurance lapse as poor risks. That means if you fall into this group, your choice of providers will be limited and you'll likely have to pay much higher than normal premiums―even if you have a spotless driving record and claims history.

Some insurers might refuse to reinstate your coverage, or charge you a higher rate to do so. And, some might force you to complete the application process again. (more)

Gender

Insurance rates, to some extent, are based on group generalizations such as marital status, age and sex. Statistics on these groups allow insurance companies to classify you either as a high or low risk client. The higher the risk, the higher the rate―or vice versa.
Statistics, culled from many years, prove younger males drive more than younger females and take more chances when behind the wheel. Consequently, this group of males usually faces higher premiums. (more)

Location

If you’ve shopped around for auto insurance, one of the first things you might have noticed is that rates vary wildly from company to company. Some insurance providers set premiums based on limits mandated by the government, and others set their rates as a complex combination of various statistics and state or local regulations, one factor considered may be your location.

Some states are known for having higher overall insurance rates than others. For example, drivers in New Jersey, New York, and Washington, DC are usually among those paying the most on average. Drivers in Iowa, Idaho, and Maine are typically among those paying the least on average. (more)

New vs. Used Vehicles

Buyers often overlook insurance rates when it comes to shopping for a car on a designated budget. Consequently, reality sets in quickly when buyers of new, fancy cars receive their initial, higher-than-expected insurance quotes.

To avoid this happening to you, always remember there's a simple formula when it comes to assessing insurance rates on cars: The greater the value, the higher the rate. So if you're trying to decide between buying a new or a used car while adhering to a budget, be aware the new car will come with higher insurance premiums. (more)