This is part 2 in a 2 part series on how to lower your auto insurance premiums. The first part covered 10 variables that you can control when it comes to lowering your premiums, while this post will talk about 10 factors that are out of your control – and what to do about them. Same Message, Different Company. Different Message, Same Company? We’ve all seen the ads about how switching your auto insurance from ‘the other’ company to ‘our company’ has saved the customer an average of $XYZ. It’s most likely left you wondering how every single insurance company can save you more than every other one. What that same advertisement doesn’t tell you, of course, is how much the guy/gal who didn’t switch saved by staying with their current auto insurance provider or going to a different one. And while we’re on the topic of auto insurance commercials, I’d like to take this opportunity to call out the marketing department of Geico. Seriously, guys? The gecko was a pretty cool guy and the caveman thing was slightly funny at first, but it’s simply gone too far. And now the googly eyes on a pile of dollar bills that somehow plays that 80′s song by that guy who is trying to sound like Michael Jackson. And running all three ad campaigns on the same medium at the same time? Collect yourselves, people! Let’s continue with the ads. Wouldn’t you love to hear “Customers who switched to us saved $215 (while those who didn’t switched saved $357)”? When shopping for auto insurance, unfortunately, there really is no easy answer to the question of which company offers the lowest rates. The reason being is that most insurance companies, by design, use a different proprietary formula to determine what price they can specifically offer you. Some of the variables that go into this formula can be controlled by you, but most cannot. So what should you do? How do you find the lowest rate? Before we go into premium savings strategy, it definitely pays to know what variables insurance companies are looking at when calculating your risk. Let’s take a look. The Auto Insurance Premium Factors that are Out of your Control Fair or not, auto insurance companies (and insurance companies in general) are master statisticians and they have determined the risk to have you as a customer for just about everything down to what color shoes you wear. These are traits or characteristics that you mostly don’t have control over, but are often used to calculate your auto insurance premium. Sure, you can change some of these things, but you would rarely change them just to get a break on your auto insurance. 1. Your age: Most policies give a reduction at 21 years of age, or with 5 years experience. A further reduction can be expected at around 24 or 25. Once you hit the ripe age of 70, you can expect the opposite to occur. 2. Your gender: Women are statistically safer drivers. This one surprises me as I’ve been a passenger while my wife is driving. She was in three accidents prior to meeting me and with my set of eyes to prevent her from driving through red lights when her attention wanders, she hasn’t been in any after meeting me. Sorry, honey, it’s true. 3. Where you live: Locales with high rates of accidents or theft can result in a higher premium. 4. Your past driving record: Some insurers look back three years, others look back five years or longer. Depending on the company that is quoting you and how recently you had a major traffic violation or accident, this can have a huge impact on your premium. Don’t worry about that pile of parking tickets in your glove box as they do not impact your driving record and premiums. 5. Your marital status: Married drivers can pay less than single drivers. 6. Occupation: Doctors tend to get in less accidents on average than ice cream truck drivers. Go figure. 7. College degrees: Most insurers give discounts to alums of certain universities. 8. Years of driving experience: similar impact as age. 9. Business use of vehicle: If using your vehicle as part of your job, you are at risk of a higher premium (and probably rightly so). 10. Multiple Vehicles: Are you insuring multiple cars on the same plan? If so, it could result in lower premiums for each vehicle. Now that you know what you can and cannot control, what can you do about it? The answer is simple. Shop around. Frequently. It’s true that you may not have control over a lot of what your premium is based on, but your saving grace is that the auto insurance companies don’t all agree on how to precisely calculate your risk. Until they do, it pays to shop around. When Should you Shop Around for Auto Insurance? For starters, it might make sense to shop around after the following events take place: When you turn 21. When you turn 25. 3 years after you have a traffic violation or accident. 5 years after you have a traffic violation or accident. When you move. When your miles driven decreases significantly. When you graduate. When you get a new job. When you get married. When you get a life insurance policy. When you get a home insurance policy. When you add another car to you plan. When you install a theft deterrent device. When you get a new car. When your credit score has improved. Whenever you feel like it! Final Thoughts: There is no auto insurer who offers the lowest rates to everyone. But there is an auto insurer who offers the lowest rate to you specifically. You just need to find them. And it might be a different insurer six months or a year from now than it is today. That’s why it pays to know what the insurance companies look at, what discounts you might be able to swing, and to shop around frequently. As seen in: http://www.mint.com/blog/how-to/10-things-that-affect-your-auto-insurance-premiums/