We have experience it at one time or another, our insurance rates increases to what seems like no apparent reason. If you ever wondered what auto insurance rating factors are used to rate your coverage, you will find that they used various factors to calculate your rate increases and decreases. Let us discuss how or what affects your insurance rating.

First insurance companies use different risk evaluator tools to determine rate increases, and the time they will implement the new increases. You will find that not all insurance companies set their rates at the same time, although, in most cases they follow the same factoring concept to established rates for their customers. One commonality between insurance companies, they used historical claim history, driving habits, number of drivers in the home to set their rates.

Insurance companies use the location where you park your automobile to set your auto insurance rate. A car park in a garage will receive a higher rating than a car parked on the street. They figure the car parked on the street chances of having an accident, vandalism or theft is greater than a car that is parked in a garage.

Your driving record is used as a factoring guide to establish your insurance rates; companies investigate your prior coverage from three years and up to seven years in some instances to determine if you had any traffic violations or accidents. They rate based on shared characteristics. What this means if a person sharing the same characteristics as you do in a group incur high claims, they will charge you more than the group who files lower claims. They use data that they compiled from claims they have paid out to determine future payouts.

Your gender is a rating factor that insurance company uses to determine rates. Studies shows that men tend to have more accidents and you will find that most insurance companies will charge male policyholders higher rates than their female counterpart.

Your age is a factor that is used as well. Insurance companies have conducted studies that showed people between the ages of 16 to 25 have a higher rate of insurance claims than people who are older. Therefore, they charge higher rates to those individuals within those ages.

Vehicle type and value are factors that affect your premiums; they looked at the vehicle year and model of different types of cars and placed you in a similar rating group. Therefore, if you purchase a car that has a history of theft or vandalism or maybe high repair cost due to the make up of its body construction. They will charge a higher premium.