Your premium is what you pay (monthly, every six months, or annually) for coverage. Insurers calculate it from dozens of factors, but a handful do the heavy lifting.
Biggest factors
- Driving record: at-fault accidents, speeding tickets, and DUIs raise rates significantly. A clean record is the single best way to keep rates low.
- Age and experience: drivers under 25 pay far more. Rates typically drop sharply around age 25 and again at 30.
- Location: urban ZIP codes with more theft, accidents, and traffic cost more than rural areas.
- Vehicle: expensive cars, sports cars, and frequently stolen models cost more to insure. Safety features can lower the premium.
- Credit-based insurance score: in most states, a higher credit score means a lower premium.
- Coverage limits and deductibles: higher limits and lower deductibles raise the premium.
- Mileage: drivers who commute long distances pay more.
- Marital status: married drivers often get slightly lower rates.
How to lower your premium
- Shop around - quotes can vary 30–50% between insurers for the same coverage.
- Bundle policies - combining car + renters or homeowners can save 10–25%.
- Raise your deductible - going from $500 to $1,000 typically cuts the premium 10–15%.
- Ask about discounts - good driver, safe vehicle, low mileage, paperless, autopay, defensive driving course, good student.
- Improve your credit score - affects rates in most states.
- Drop unnecessary coverage - collision/comprehensive may not be worth it on an older car worth less than ~$2,000.
- Use telematics/usage-based programs - let the insurer track your driving for a potential discount.