Factors that Affect Auto Insurance Rates

Factors that Affect Auto Insurance Rates

In most states, you are legally required to have auto insurance if you are driving or own a vehicle. However, auto insurance can be a significant expense that many people would like to better manage. The cost of your insurance premium will depend on a variety of factors.

Driver Experience and Track Record

The first factor that can influence auto insurance rates more than anything else is the age and track record of a driver. According to insurance companies, younger drivers with less experience are more likely to be involved in an accident than someone who has been driving for more than 10 years. Unfortunately, this means that newer drivers tend to have higher insurance premiums that only increase with accidents on their record. Similarly, drivers who are experienced but have a history of being involved in accidents or getting moving violations are more likely to have a higher insurance premium than someone with a clean driving record.


When a car insurance provider generates an insurance premium, they take into consideration where you live and work. In certain areas of the country, auto accidents, theft, and other insurance risks are more prevalent, making insurance premiums higher for residents of these areas. In general, people that live in densely-populated urban areas will have higher insurance rates than someone who lives in the suburbs or a rural market where risks are lower. Areas that rely heavily on street parking or where auto theft is common can also present a higher risk of uncontrollable accidents.


Auto insurance providers have found a direct link between gender and the likelihood that someone will be involved in an accident. Overall, auto insurance providers have determined that men are far more likely to be involved in an accident and will have to file an insurance claim in the future than women. Generally, men spend at least 10% more on auto insurance than women.

Miles Driven Per Year

As expected, the more that someone drives in a year, the more likely it is that they will be involved in an accident or have to file an insurance claim. Because of this, insurance companies often ask how many miles you drive on an annual basis. The insurance company will likely take this information and then determine what your rate will be based on its increased risk. Generally speaking, the more you drive, the more you should expect to spend on auto insurance as it increases the wear and tear on your vehicle and likelihood of an accident occurring.

Credit History

One factor that insurance companies use that may surprise a lot of auto insurance customers is their consumer credit score. Major insurance companies have found a direct link between credit score and overall insurance risk. In general, if you have a good credit score, you will not be affected in any way. However, if your credit score is less than par, this could be held against you by the insurance companies and you could end up being charged higher rates. While this practice is common, it is actually outlawed in some states including California, Hawaii, and Massachusetts.

Auto insurance is a valuable, and in most states required, thing for all drivers to possess, and it is recommended that you check in with your insurance provider periodically to see how your premiums may change. If you have questions or are looking for recommendations on what you might be able to do to decrease your rates, contact your local Acceptance Insurance agent today.

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