Car insurance premiums are based on several important factors, some of which aren’t even in our control. We can’t help our age, after all, and we may not be able to help the car we drive or how far we travel to work.
Regardless, these factors and others play a part in the cost of car insurance — good or bad. They also leave some of us paying more — and potentially a lot more — in premiums.
If you’re someone who feels like they’re paying more than their share, it’s worth figuring out why your rates are higher and if there’s anything you can do about it. Here are the main reasons you could be charged higher premiums than other drivers.
1. Age, sex & marital status
You can’t help your age or gender, yet these factors are used to determine auto insurance rates. Across the board, rates tend to be higher for people under the age of 25 – and especially single males, notes State Farm. If you’re married, your rate could also be lower. Why? Because data indicate married individuals are less likely to get in a car accident and all insurance is priced by risk.
2. Your credit history
Believe it or not, auto insurance companies frequently check credit scores to gauge a person’s individual risk. While how much money you owe on your credit cards or whether you have defaulted on debts in the past may not affect how well you steer, insurance companies have found a correlation between risky credit and risky driving.
Fortunately, unlike your age or your sex, your credit history is one area where you have some control. If you have poor credit, taking some simple steps to boost your score might help you attain lower rates. Pay all of your bills on time, reduce the amounts of debt you owe and refrain from opening or closing credit accounts, and you’ll give your credit score the best opportunity to flourish.
3. Your driving record
While young people tend to pay higher auto insurance rates, so do people who have blemishes on their driving record. If you have an accident on your record that was your fault or several speeding tickets, for example, you should absolutely expect to pay higher insurance bills to make up for the additional risk.
On the flip side, this is one area where you, the driver, have a lot of control. By maintaining good driving habits, you can keep your auto insurance rates as low as they can go.
And, if you have bad marks on your driving record but have since committed to driving safer, don’t despair. The longer it’s been since you’ve had a crash or received a citation, the less impact you’ll see on your auto insurance rates.
4. Your driving habits
If you commute to work or drive more than the average person, you may need to pay higher insurance rates to account for the extra mileage (More miles equals more opportunies to get in an accident.) On the other side of the coin, people who live close to work and don’t put a lot of miles on their cars can often score heavy discounts for being considered a “low-mileage” driver.
5. Where you live
Almost every state mandates you carry a certain amount of car insurance, so those requirements will influence what you pay. You can see how much car insurance your state requires here.
Beyond these laws, if you live in an area with a high rate of crime, you may pay higher rates to make up for the higher risk of vandalism or theft. If you live in the country or in an area with a low crime rate, on the other hand, your auto insurance could be a better deal.
6. Your deductible & policy limits
Again, most states require a minimum level of auto insurance, but this “minimum coverage” is rarely sufficient to protect your finances in the event of an accident. That’s why most auto policies offered through insurers boast beefier coverage with higher limits and better levels of protection. Obviously, a higher level of coverage will cost more money – even if you know you need it.
Your deductible – the amount of money you owe out-of-pocket when you file a claim – can also play a role in your insurance rates. The higher deductible, the lower your insurance rates tend to be. If you choose a lower deductible, on the other hand, you can expect to pay more in monthly premiums.
7. Your car
Last but not least, the actual car you drive will impact how much you pay for auto insurance. For instance, if you drive a pricey ride, like the Tesla Model S, expect your car insurance to cost more. (You’d need more coverage for replacement parts, etc.) Or, if you drive a car that’s notoriously popular with thieves, your rates could be higher, too.
If you’re paying more than you want for car insurance, it’s not the end of the world. While some of the factors that affect rates are beyond your control, there are still plenty of tweaks you can make to score lower rates in the future. We’ve actually got a roundup of common car insurance discounts right here. Beyond changes you make, you should also get a free quote for car insurance in your area. By shopping around and comparing insurers. you could get lower rates without changing a thing.
Disclosure: PolicyGenius offers insurance policies from many of the nation's top insurers, who pay us a commission for our services. However, all editorial choices are made independently.