What Factors Make Car Insurance Expensive?

March 14, 2019

And how can I control them?

Numerous factors influence your auto insurance premium.

Every company weighs factors differently using complex rating schemes that are proprietary and unknown to the consumer. There are however some factors that are frequently used that make for significant differences in premiums between auto insurance buyers. Here are some of those factors ranked in what I see as having a major versus less than major impact on auto insurance rates: MAJOR FACTORS:

Credit History or more specifically - Insurance Score

Your insurance score is closely related to your credit score. Improving this score can be one of the most influential factors to what you will pay for insurance going forward.
States that do not allow the use of Insurance Scores: California, Hawaii, and Massachusetts.

Claims History

Claims frequency is more important than driving record. Most insurance companies have rating schemes that reward those who do not have claims. Read that to also include surcharge or remove discounts for those who do.

Driving Record

Driving record, specifically violations are less of a factor than they used to be. A poor driving record in combination with a poor insurance score and claims history is a recipe for very high insurance rates.

Continuous Insurance Coverage

Yep. Not maintaining proper insurance coverage can mean a big difference in what you pay for insurance.

Garaging Location

In some areas of the country, where a car is principally garaged can make a huge difference in your auto premium. An extreme example can be seen in the state of Michigan. The Insurance Information Institute reports the average cost of an auto insurance policy in Detroit is $10,723. The whole state of Michigan averages $1,131 for the same policy.

OTHER FACTORS:

Age-Related

Youthful Operators

This can be a ‘major factor” if a driver is under the age of 25. The younger the driver, the more expensive rates will be. If the young person is deemed a “primary” operator, the increase in premium can be as much as 3-fold.

Gender

Gender has little impact on auto rates but for youthful operators. Boys pay more than girls especially during the teen years. Once an adult, gender has little influence on auto rates.

Years of Driving Experience

Years of driving experience impacts:

Young drivers
Drivers who first choose to drive
International operators entering the country

Most companies will add what is called an inexperienced driver surcharge to those with less than three (3) years driving experience in this country.

Vehicle Make/Model/Submodel

Data on every Make, Model and even Sub-Model of vehicles is collected and parsed to determine those cars that are safer, cost less to repair and have lower incidents of theft.
These statistics impact auto insurance rates for all coverages in today’s rating schemes.

Coverage Limits - Comprehensive & Collision Deductibles

It may go without saying that the better your coverage, the more you will pay. That is true, but it may surprise you how little an extra “layer” of liability, uninsured motorist and personal injury protection will cost.
However, there are significant differences between the minimum coverage limits required by law - and - those that reflect more responsibility.

Less Important Factors:

Occupation

A few companies will adjust rates based on higher risk occupations and discount rates slightly for less risky careers.

Education

There are some companies that will provide a break on premium based on your education level. Those levels may include; no high school, high school, some college, college degree, masters or PhD completion.

Previous Liability Limits

Yes. There are companies that will provide a better rate to those who have carried higher liability limits on their previous insurance contract.

Marital Status

Not a significant factor. With many companies not a factor at all.

Vehicle Use

Vehicle use was a big factor in auto rates for many decades but has taken a back seat to the other variables above.

Miles driven annually

Some companies still provide minor discounts for low mileage but fewer increase premiums because of long commutes. Not a major factor with many companies.

Those are some of the factors, major and otherwise, that influence your auto insurance premium.
If you are seeking sound strategies that you can employ to reduce your auto insurance focus on those that you can control. This information is key to making a difference in your rates going forward. Have more insurance questions? Stop in and see us anytime or give us a call at 607-324-7500. We LOVE to help!

< Older Post

Newer Post >

Auto Rates and Finger Prints: Both are Unique to You!

By Jeff Ryan • April 7, 2026

Factors You Can’t Easily Control These factors are built into your profile, but still play a major role: Your location: Claim trends, traffic, and weather patterns where you principally drive. Your age and driving experience: Especially for younger drivers. Other drivers in your household: Their age and driving history. The vehicle you own: Unique to the Year, Make, Model, and Sub-model’s damageability and cost of parts/labor. These factors significantly influence price differences, but they don’t tell the whole story. Factors You Can Control This is where habits and wise decisions can make a real difference: Your driving habits: Minimizing tickets and accidents can have a direct impact. Your coverage choices: Liability limits, deductibles, and optional coverages can vary widely. Your insurance consistency: Avoiding lapses in coverage. Your annual mileage: How much and how often you drive. Discount opportunities: Bundling, pay-in-full, NYS defensive driving course. Your Insurance Score (Yes—You Can Influence It) Insurance companies use a credit-based insurance score as part of their rating process. While it’s based on financial behaviors, it is not permanent—and it can be improved over time. Simple habits like: Paying bills on time Reducing outstanding debt Avoiding excessive credit inquiries… can positively impact your score—and in turn, your insurance rates. Your insurance score is under your control and a worthy mid to long-term project in and of itself. For more information on what you can do to positively influence your score, see: Great 8 Tip #8 - What's Credit Got to Do with Insurance? How Can I Improve My Auto Insurance Score Why Comparing Rates Doesn’t Work When someone says, “I only pay…” , the uniqueness of their fingerprint is missing. What are their: Deductibles Driving history Insurance score Household profile Coverage limits: what they may be giving up in terms of protection. Price without context can be misleading and discouraging.