Why Do Auto Insurance Rates Change?

Auto insurance rates are affected by a number of factors, including the type of car you buy and even your age. The list of what affects insurance premiums is actually pretty long. But if youre wondering just how your coverage might be affected, take a look below at some factors that determine why rates change.

  • Age. Even though theres nothing you can do about the year you were born, companies look at how old you are to determine auto insurance rates. If youre under the age of 25, youre going to see the highest rates because as a young driver, companies assume youll be reckless. As you grow older, youll see rates decrease; that is, as long as you dont make too many driving mistakes along the way.
  • Driving Violations. As you can imagine, having a bad driving record tops the list of what can affect insurance premiums. The more problems you have while on the road, the more your company will have to pay to cover you. So if you amass tons of violations, you can expect your auto insurance rates to change.
  • The Type of Vehicle You Drive. When you go to pick up your sports convertible, dont be jealous that your friend who just picked up his minivan is paying a much lower premium. Unfortunately, the type of car you drive makes a difference in your rate. Sports cars in particular are high theft risks as well as a great temptation for those who love to speed both reasons for your rate to increase.
  • Credit Rating. Most insurance companies check your credit report to decide how likely you are to actually pay your bill. So if you have fluctuations in your credit score, you are likely to also see fluctuations in your auto insurance rate.
  • Good Driving Record. Many companies reward customers for an absence in violations, so if you behave on the road, you may see a positive change in your premium.

These are just a few items on the list that may change your auto insurance. Some other items include marital status, occupation, geography and even gender. Of course, you cant have control over everything that affects auto insurance rates, but the things you can control can have a positive impact on your rates.