How Are Car Insurance Rates Determined?

Many drivers wonder how their car insurance rates are determined. It can feel confusing, but the truth is straightforward. Insurers look at specific details about you and your driving habits to set your rate.

By understanding these factors, you can see why your premium changes over time — and learn what you can do to keep costs down. Our goal is to shed light on what goes on behind the scenes, so you can feel confident in the coverage you choose.

Let’s break it down so you know exactly what goes into calculating your premium.

How Does My Age Affect My Car Insurance Rate?

Your age plays a huge role in what you pay for car insurance. Younger drivers pay more because they have less experience and are more likely to get into accidents. In fact, drivers ages 16–19 have a crash rate nearly three times higher than drivers 20 and older, according to the Insurance Institute for Highway Safety (IIHS).

If you’ve heard that rates drop at 25, it’s true. By then, many insurers consider you a lower risk because you’ve gained years of experience behind the wheel. Staying accident-free in your early driving years can help you earn lower rates once you hit this milestone.

However, premiums can start rising again around age 70. Even if older drivers have fewer crashes overall, insurers see increased risk due to slower reflexes, health issues, or vision changes that come with age. Keeping up with regular physicals and eye exams can help you stay safe behind the wheel — and may even help keep your insurance costs lower.

Does Gender Change What I Pay for Car Insurance?

Your gender can also affect what you pay for car insurance. Statistics show that men, especially young men, are more likely to engage in risky driving behaviors like speeding or aggressive maneuvers. In fact, the Insurance Institute for Highway Safety (IIHS) found that male drivers account for nearly 72% of motor vehicle crash deaths each year.

This difference is most noticeable for men under 25, who have some of the highest rates of speeding-related crashes. When combined with a lack of driving experience, it creates a higher risk profile. Insurance companies use this data to set rates based on who is statistically more likely to file a claim.

While gender alone doesn’t tell the whole story, it’s one of several factors insurers use — especially when paired with age and driving history — to predict how likely someone is to have an accident.

How Does My Driving Record Impact My Insurance Cost?

Your driving record is one of the biggest factors insurers use to set your car insurance rate. A clean record shows you’re a responsible driver, which means lower risk for insurance companies — and often lower rates for you.

Tickets, accidents, or DUIs will almost always raise your premiums. Each incident makes you look riskier to insure, and insurers may see you as more likely to file a claim in the future.

But there’s good news: many companies now offer telematics programs or safe-driving apps. These tools track habits like your speed, braking, and even the time of day you drive. By showing you drive safely, you can earn discounts — sometimes up to 30% — just for proving you’re a cautious driver.

Staying alert, following traffic laws, and avoiding distractions behind the wheel are the best ways to keep your record clean and your insurance costs low.

Does Being Married Affect My Car Insurance Rate?

Your marital status can also impact what you pay for car insurance. Studies show married drivers tend to get into fewer accidents compared to single drivers. Insurers believe marriage often brings more stable routines and cautious driving habits, which can lower your risk — and your premiums.

Some insurance companies even offer discounts when married couples bundle their policies. This can mean extra savings on both car and home insurance. If you get married or divorced, be sure to update your marital status with your insurer so your rate reflects your current situation.

Why Does My Location Make Car Insurance More Expensive?

Where you live has a big impact on your car insurance rate. Insurers look at local accident statistics, crime rates, and weather risks in your area. If you live in a busy city with more traffic and higher chances of theft or collisions, you’ll likely pay more. Rural areas or small towns with fewer cars on the road often come with lower premiums.

In Florida, drivers pay some of the highest premiums in the country. That’s because Florida has unique challenges that make driving riskier and more expensive to insure. The state has one of the highest rates of uninsured drivers in the U.S., which means there’s a greater chance you or your insurance company will end up paying for damages if you’re hit by someone without insurance. Florida also sees frequent hurricanes and severe storms, which can cause widespread vehicle damage. Additionally, areas with dense traffic like Miami, Orlando, and Tampa raise the odds of accidents.

According to the Insurance Information Institute, Florida’s average annual premium is about 37% higher than the national average. These factors combined make Florida one of the most expensive states for car insurance.

How Does the Type of Vehicle I Drive Affect My Premium?

The car you drive plays a big role in your insurance rate. Sports cars and luxury vehicles almost always cost more to insure. They’re expensive to repair, attractive to thieves, and more likely to be driven at high speeds — which can lead to more tickets and accidents.

Trucks can also come with higher premiums, especially large or heavy-duty models. That’s because they can cause more damage in an accident, making claims more costly for insurers.

Let’s be honest: car repairs aren’t cheap no matter what you drive these days. But there are definitely vehicles that cost less to fix, which can help keep your premiums down. On the flip side, choosing a car with built-in safety features can help prevent your rates from skyrocketing. For example, a Tesla’s cameras and sensors can reduce the risk of accidents, which insurers like — even if repairs can still be pricey.

Vehicles like minivans and sedans often come with lower rates because insurers see them as more likely to be driven carefully, especially when they’re used to transport families. Choosing a car with good safety ratings and lower repair costs can make a big difference in your insurance price.

Does How Much I Drive Change My Car Insurance Rate?

How much and how often you drive can greatly impact your car insurance rate. The more miles you put on your car each year, the more time you spend on the road — and the higher your chances of getting into an accident.

If you commute long distances daily or use your car for business, expect to pay more. Insurers see these drivers as higher risk since they’re on the road more often.

But if you drive less than average, you may qualify for low-mileage discounts. Working from home or retiring are common life changes that can lower how much you drive — and it’s important to let your insurer know. The same goes for work trucks used only on a farm or private property. Since these vehicles aren’t driven on public roads, they often need less coverage, which can lead to lower premiums.

Keeping your mileage updated helps you avoid overpaying for coverage you don’t need.

How Can I Get the Best Car Insurance for My Needs?

Now you know what goes into your car insurance rate. It’s not just about your car — it’s about you, your driving habits, and even where you live. Factors like your age, gender, driving record, vehicle type, mileage, and location all work together to shape what you pay.

That’s why a freshly licensed young man driving a souped-up truck will have a very different rate than a parent who rarely takes their minivan out past 9 p.m. Understanding these factors helps you make smart choices to keep your insurance affordable.

At O’Quinn Insurance, we take the time to get to know you and fit your policy exactly to your needs. There’s no one-size-fits-all solution when you have access to over 60 carriers to offer your clients. Contact us today for a personalized quote, and let our experts help you find coverage that truly fits your lifestyle and budget.