Some factors responsible for higher auto insurance rates have nothing to do with your driving record. Learn what affects your car insurance rates most. Have you had your auto insurance rates increase even though you have a clean driving record? This is an extremely frustrating phenomenon, but it is bound to happen when the economy functions the way it does.

Changing Cars

You may not think about it, but if you change cars, especially if you replace an older car for a newer one, your rates will go up. Even though everything about you is the same, a new car costs more to repair and replace than an older vehicle. If you have a new car with a loan, then you are required to have complete comprehensive and collision coverage on the vehicle. If you had only liability coverage on an older car, then the increase between liability and complete insurance can be shocking.

Covering the Risk

High-powered statisticians called actuaries set insurance rates. Actuaries crunch lots of data about accidents, drivers, road conditions in states, tickets, types of cars, ages of drivers and many other factors you may not even consider as having an impact on insurance rates. But the actuaries figure out how much each of these factors affects the cost of insuring a car.

If the costs for your age group, gender or area of the country go up, then your rates will go up. This applies even if you weren’t a contributor to the higher rates—if you’re driving record was completely clean, you never speed and you drive only a few miles a day. Still, your rates will go up if the cost of your overall demographic goes up. That’s how insurance actuaries cover the risks.

Medical Costs

Part of the cost of auto insurance covers medical care for you and/or those you may injure in an accident. As the cost of health care increases and resources become scarcer, then the cost of auto insurance also goes up. The increased costs of health care have to be absorbed into the policies so that the health benefits can be paid.

Car Repairs

Much of the cost of automobile insurance is linked to the costs of car repairs. If you have had occasion to get an estimate or a repair done on the body of your car especially, then you know that even a very simple body repair is extremely expensive. A simple, 3-inch scratch on the door of a car can cost more than $300 to repair, while additional accidents cost even more. These rising auto repair costs must be absorbed into the premiums, so this also causes a rise in rates.

Legal Expenses

Often those involved in a car accident sue the person who was at fault and sue the insurance company to get further benefits. Insurance companies tend to pay as little as possible, and will sometimes deny claims that seem obviously payable. It is in these cases that attorney’s fees begin to rise. This means the cost of doing business rises, and the cost to the insured rises in turn.

The cost of insurance goes up, even if you are a great driver and never have an accident. While it doesn’t seem fair, it is the way insurance companies keep prices average for everyone.