Florida Auto Premium Rating Factors


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Insurance premiums in Florida can often be very high.  It is important to understand the factors that affect those premiums so you can manage the elements that you have control over.

I. Types of Coverage and Coverage Limits Selected: Often, minimum requirements are not enough. Be sure to select the types and amounts of coverage that you need.  Every change in limits or types of coverage affects your premium. When you shop around, be sure to compare apples to apples.

II. Territory: Where you live and garage your car make a difference.  When comparing the same coverage, for the same driver and car, the premium will be different if that person is living in Miami, or Orlando, Naples or Tallahassee, Jacksonville or Palm Beach Gardens. See our pages that show the relative costs and best companies by county and community.

III. Drivers: The age, gender, years of driving experience, and driving record of each driver in the household affect the policy premium.  Young male drivers are usually the most expensive to insure.  As part of the application process, insurance companies research each driver’s motor vehicle report and claims history before determining the premium level.  In this computerized aged, there isn’t much that escapes their attention.  The worse the driving record, the higher the premium, and in some cases it could mean outright rejection of the application.

IV. Vehicles: The types of vehicle, the frequency of that type vehicle being involved in an accident, the bodily injury claims sustained in accidents with the vehicle, and the cost to repair or replace it, all affect the premium.  Low profile, moderately priced, safe vehicles have lower premiums than sports cars and cars that are more expensive.  If the vehicle is listed as one of the most popular among thieves, that also affects the premium. Some companies simply will not offer a policy for certain high profile vehicles.

V. Vehicle Use:  The premium changes based on whether you use your vehicle for pleasure, for business, or for commuting to work.  The total miles you drive in a year and, if you commute, the miles you drive one way to work also affect the premium.  The more the vehicle is on the road, the higher the risk.

VI. Prior Insurance: Whether you have prior insurance, the limits of Bodily Injury Liability on that prior insurance, and the length of time with the prior insurance company can all affect the rate for a new policy or even preclude a policy being issued by a new company. High prior limits and multiple years with the same company often produce better premiums when you shop around.

VII. Credit History: The use of credit scores has become commonplace as a major factor affecting premiums.  Companies have determined that credit history has a significant statistical connection to claims and they have created complex formulas for combining individual credit scores with all of the other factors to arrive at your premium.  Often, an adverse credit score can have a greater negative affect on your premium than an adverse driving record. Superior credit scores lead to lower premiums while poor scores lead to higher premiums.  Although some companies do periodic reviews of their policyholders’ credit history, most companies only look at credit history when determining the appropriate premium for new applicants.

VIII. Miscellaneous Factors: Whether you rent or own your home and your highest level of education can also be factors in determining your premium.

IX. Individual Company Costs and Experience: Finally, the more claims that a company experiences and the higher its overhead costs are also factor into the equation. Insurance companies are in the business to make a profit so if they are losing money they need to charge more for their policies. That is one good reason to shop around

These are the most significant things that affect your premium. Control those factors that you are able to control and be sure to get all the discounts allowable.  Please see our page explaining the most important discounts.