Auto Insurance Ratings Factors Author:    Posted under: Auto InsuranceAuto Insurance RatesAuto Insurance Ratings and Factors

Car insurance rates may differ considerably from one company to another. Many factors affect the premium you will pay for auto insurance. Your insurance agent may find it difficult to explain rate increases and that is because most insurance companies have formulated their own mathematical algorithm – the agents only need to input your information into a computer and the computer in turn checks the information thoroughly and computes the rates. In any case, insurance agents have an Underwriting Guideline to help explain. Many companies use these standard rating factors that affect our car insurance rates.


Statistically, drivers between the ages of 16 and 25 pose a greater risk of being in an accident than those between the ages of 25 and 73. Drivers between the ages of 50 and 65 generally have the safest driving records.


Women are statistically safer drivers than men so companies use this as a rating factor. But this trend is changing as more and more females drive every day.

Marital status

A married person pays less than a single person because claim statistics show a lower rate of car insurance claims among those who are married versus single policyholders.

Where you live

States with high population densities have higher accident rates than states that have very little traffic. The neighborhood you live in can also be a factor. Where you park your car at night, and the risk of vehicle theft will also raise your premium.

Driving Record

People with multiple moving violations and a history of accidents are at higher risk for accidents than people who have clean driving records, which means they are more likely to get higher premiums.

Type of Vehicle

The make, model and style are also factors in your car insurance rates. A cheap four-door sedan will cost less to insure than a brand new sports car. Every car make and model has a history so you are positioned in a related rating group for your car. Groups that have more record of theft and/or vandalism or soaring repair costs will equate to higher premiums.

Credit rating

Using credit standing as an indicator for insurance ratings helps insurance companies predict risk. A better credit score will ensure you save on your insurance premium.

Prior Insurance Coverage

Your prospective insurance company will want to know how long you have had constant insurance, how long you were with your prior providers, what limits you had with m and the reason you left or are leaving that provider.

Vehicle Use

The amount of time and the distances you drive your vehicle is also a determinant to your insurance rates. The more time you spend on the road, the more exposed you are to accidents, the higher you have to pay for your insurance.


Statistics show that there is a correlation between your occupation and the risks you are exposed to. For example, a delivery person is at more risk of accidents on the road than someone who works a desk-job 8 hours a day.

Type of Coverage

The more coverage you want, the higher your rates will be.

Your car insurance rates are based on some factors that you can control, like your credit history and driving record and some that you can’t like your age and prior accidents. Checking what affects your ratings can save you money on auto insurance policies.


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