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    Insurance | 2 min read

    What Factors Impact Your Car Insurance Rates?

    Like the Bermuda Triangle, the Sphinx, and the island of Atlantis, the way that car insurance rates are calculated is one of life's great mysteries. There are many factors that go into determining your individual rate, but there are also behaviors beyond your control that can have a potential impact on your premiums.

    Most people never put much thought into how their carrier arrived at their specific rate, so today, we'll dive into some of the variables.


    If you’ve ever parented a teenager—or, if you want to be completely honest and reflect on your teenage years—you know how irresponsible some teenagers can be behind the wheel. When it comes to car insurance rates, carriers make risk assumptions based on a driver's age and driving experience. From a statistical standpoint, the less you've driven over your lifetime, the more likely you are to cause an accident. The risk of a motor vehicle crash is highest among teenagers ages 16-19, compared to all other age groups, according to the Centers for Disease Control and Prevention.


    The more vehicles that are on the road where you live, the higher your chances are of paying higher premiums than your rural counterparts. Drivers who live in cities and towns with a higher concentration of traffic or higher rates of theft pay higher insurance premiums. Carriers view heavy traffic, congestion, and high rates of auto theft as risk and higher risk translates to higher premiums.

    Marital status

    While it may seem like a sweeping generalization, some aspects of the “insurance premium algorithm” are very much that—generalizations. Whether you fall into this bucket or not, insurance carriers view married couples as less risky drivers than their single counterparts, and reward them with lower car insurance premiums—around 10% less on average, according to CarInsurance.com. Their theory is that married people tend to be more responsible and mature; therefore, they are more careful drivers than singles.

    Vehicle make and model

    Some vehicles are safer than others, and carriers will reward their drivers with lower insurance premiums. Likewise, more expensive vehicles and vehicles that have a higher rate of theft will cost you more to insure. For example, all things being equal, a minivan will most likely cost less to insure than a lifted pickup truck that is more attractive to car thieves and whose driver may be more likely to be a bit reckless while driving.

    Driving record

    Your driving record is one aspect of your insurance rate that you can, for the most part, control. It also has the greatest impact on your individual premium. Insurance carriers base your rate on the likelihood that you will be involved in an accident, and if you have a record that is riddled with speeding tickets and fender benders, your insurance rate is going to reflect a higher level of risk. Obviously, accidents are not completely unavoidable, but doing your best to abide by all traffic laws and maintain a clean driving record is your best bet for keeping your auto insurance premiums as low as possible.

    While buying auto insurance is unavoidable if you own and drive a vehicle, the amount you pay for your premiums can be somewhat flexible. Shop around and review all of your options to make sure you're getting the best rate for your situation.

    Visit swbc.com/auto-insurance to receive your free, apples-to-apples auto insurance quote.

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    Jennifer Lopez

    Jennifer Lopez is an experienced agency sales, client manager, and insurance agent with a demonstrated history of working in the financial services industry.

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