Mercury Insurance Details the Top Factors That Could Affect Your Car Insurance Rates

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Mercury Insurance (MCY) outlines the key factors affecting car insurance rates in response to rising premiums. According to Kevin Quinn, VP of Auto Claims, driving record is the most controllable factor, with clean records typically securing the lowest rates. The company identifies five main factors:

1. Driving record: Past behavior predicts future risk, with violations affecting rates for 3-5 years 2. Age: Teenagers pay higher premiums, rates decrease until mid-50s 3. Location: State laws and ZIP codes influence rates 4. Vehicle type: Luxury, sports cars, and EVs generally cost more to insure 5. Credit score: Poor credit correlates with more claims, though some states prohibit this factor

Driving Record, Age and Vehicle Type Are Major Considerations

LOS ANGELES, May 15, 2025 /PRNewswire/ -- Prices for just about everything are on the rise these days, and unfortunately, that includes car insurance. Now more than ever, consumers are looking for ways to lower their auto insurance premiums. However, in order to maximize these savings, it's important to first understand the different factors that insurance providers look at when setting their policyholder rates.   

While there are a variety of factors that affect car insurance rates, your driving record is one of the most influential.

"Unlike other factors, your driving record is one that you have some control over. Drivers with a clean motor vehicle record and no at-fault accidents typically get the lowest car insurance rates," said Kevin Quinn, Vice President of Auto Claims for Mercury Insurance. "Other key factors that affect your rates include your age, the vehicle you drive and where you live, among others."

Here's a detailed breakdown of the main factors that generally affect car insurance rates:

• Driving record: Insurance companies use a driver's past as a predictor for future risk. Even just one speeding ticket or accident could raise your rates. Insurers typically look at your record from the last three to five years, but more serious violations like a DUI or multiple speeding tickets might follow your record for longer.
  
  
• Age: Age is another big factor that affects insurance rates, especially for younger drivers. Data indicates that teenagers are riskier drivers, so they often pay more for auto insurance. As drivers become more experienced, their insurance premiums tend to decrease, with the lowest rates generally afforded to those in their mid-50s before rising again for seniors.
  
  
• Location: States with laws that mandate more coverage types and/or higher coverage limits will likely have higher auto insurance costs — even certain ZIP codes can have higher rates. "If a policyholder lives in an area that is more prone to vandalism, like a big city for example, car insurance premiums will be higher because the possibility of that policyholder filing a claim is greater," added Quinn.
  
  
• Vehicle type: Before driving that shiny new car off the lot, think about insurance for it. There are several types of cars that generally cost more to insure, including high-end sports cars, luxury cars and some electric vehicles. This is due to their parts costing more to repair or replace after an accident. An EV battery, for example, can cost thousands of dollars to replace if damaged. Generally, cars with strong safety ratings, lower repair costs or advanced safety features cost less to insure.
  
  
• Credit score: Many drivers are likely unaware that their credit score is fair game for insurance companies when setting rates. Data indicates that drivers with poor credit file more claims than do drivers with better credit — and more expensive ones, too. However, a handful of states — including California, Hawaii and Massachusetts — have outlawed or restricted the use of credit scores as a rating factor.

"We understand that in these uncertain economic times, many are looking to reduce their auto insurance spend. Therefore, it is best to focus on the factors that you can control. Choose an affordable vehicle with good safety ratings. Research average insurance rates in different ZIP codes before planning a move. And, most importantly, be attentive and follow the law when behind the wheel," said Quinn. 

For more information about auto insurance and lowering your rates, visit Mercury's blog.

About Mercury Insurance 

Headquartered in Los Angeles, Mercury Insurance (NYSE: MCY) is a multiple-line insurance carrier offering personal auto, homeowners, and renters insurance directly to consumers and through a network of independent agents in Arizona, California, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas and Virginia, as well as auto insurance in Florida. Mercury also writes business owners, business auto, landlord, commercial multi-peril and mechanical protection insurance in various states. 

Since 1962, Mercury has provided customers with tremendous value for their insurance dollar by pairing ultra-competitive rates with excellent customer service, through nearly 4,100 employees and a network of more than 6,500 independent agents in 11 states. Mercury has earned an "A" rating from A.M. Best, as well as "Best Auto Insurance Company" designations from Forbes and Insure.com. For more information visit www.MercuryInsurance.com or follow the company on Twitter or Facebook.

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SOURCE Mercury Insurance

FAQ

What are the top factors affecting car insurance rates according to Mercury Insurance (MCY)?

According to Mercury Insurance, the top factors are: driving record, age, location, vehicle type, and credit score. Driving record is cited as the most influential factor.

How does age impact car insurance rates according to Mercury Insurance?

Mercury Insurance states that teenagers pay higher premiums due to higher risk, rates decrease with experience, reaching lowest points in mid-50s before rising again for seniors.

Why do electric vehicles cost more to insure according to Mercury (MCY)?

According to Mercury Insurance, EVs often cost more to insure due to expensive repair costs, with EV batteries alone potentially costing thousands of dollars to replace if damaged.

How long do driving violations affect insurance rates according to Mercury Insurance?

Mercury Insurance indicates that insurers typically look at driving records from the last 3-5 years, though serious violations like DUIs or multiple speeding tickets may affect rates for longer.

Which states prohibit using credit scores for car insurance rates?

According to Mercury Insurance, California, Hawaii, and Massachusetts have outlawed or restricted the use of credit scores as a rating factor for car insurance.