Insurance Information Institute (III), the insurance industry's reliable information source, reports that "[t]he cost of auto insurance is expected to rise by 3.5 percent in 2004, the smallest increase in four years." The average auto insurance cost in 2004 is estimated to be $871 per vehicle, compared with $842 in 2003 and $781 in 2002.

This story also offers some great insights into what drives the insurance premium higher every year. Acording to III, "The declining number of auto accidents due to better drivers and safer cars and crackdowns on fraud and abuse are behind the trend, though rising costs for medical care, vehicle repairs and skyrocketing jury awards remain a problem, according to the I.I.I. analysis." Some interesting facts:

- Auto repair costs are doubling the speed of inflation.
- "The average jury award in auto liability cases rose from $187,000 in 1994 to $323,000 in 2001 - an increase of 73 percent"
- Auto theft is rising: "According to preliminary data from the Federal Bureau of Investigation's Uniform Crime Report, the number of auto thefts rose by 0.9 percent during the first half of 2003, the latest period for which data are available." "This comes on the heels of a 1.4 percent increase in auto thefts in 2002, 5.9 percent in 2001 and 0.7 percent in 2000."

For an individual driver, the important facts are:

- The type of car and specific safety features;
- The amount of miles driven and type of driving;
- Family claim record, including the number of accidents and their severity;
- Driving record, including speeding tickets;
- Age, gender and experience of driver; and
- Credit-based insurance score.

And III offers some tips for getting a lower auto insurance premium:

- Raise your deductible.
- Compare insurance costs before buying a car.
- Reduce coverage on older cars.
- Buy home and auto policies from the same insurer.
- Maintain good credit.
- Shop around.

Topic Sponsors:

Matrix Direct -- the fast, easy no hassle way to buy term life insurance.
Life Insurance Quotes
Free Car Insurance Quotes
Life Insurance in 10 minutes if qualified. No medical exam.