When you bought your first car, friends or family might have shared this advice with you.

“Don’t buy a red one. The price to insure a red car is outrageous!”

The person giving that advice was probably well-intentioned. But they were wrong, according to the Insurance Information Institute, which listed car color impacting rates as one of eight insurance myths. But plenty of factors do matter when insurance companies decide how much you’ll pay for your auto policy.

Here are the factors that could determine your car insurance rates.

Where You Live

Do you live in an urban or suburban area? Do you park your car on the city street or in your own two-car garage? Or do you reside in a rural area, where cows outnumber cars? The Insurance Information Institute says insurance companies consider a variety of geographical factors when setting your premiums.

Among them is whether you spend your time driving on busy, big city roads, where accidents, vandalism and theft are more prevalent than in the suburbs, per the organization. Other factors are based on your state and region and include everything from local costs for things such as medical care, body-shop repairs and the weather.

Your Driving History

Do you have a clean record behind the wheel — no moving violations, no accidents? Or do you find yourself involved in a fender bender once every couple of years? If you fall into the latter category, expect to pay increased insurance premiums.

The Insurance Information Institute says if your driving record shows a history of accidents, you’re likely to pay more for insurance. The organization reported that if a claim is made against your policy for an incident that primarily is your fault, your insurer will raise your premium. Additionally, while how much depends on the company that issued the policy, the increases typically will apply for three years.

Time on the Road

Do you work remotely or do you drive 35 miles each way to and from work? If you fall in the first group and only use your car to run errands and shuttle the kids to and from school, insurance companies will charge lower premiums. The less time you spend behind the wheel means you don’t drive that many miles per year — dropping your odds of involvement in an accident.

Your Car’s Make and Model

Do you own a sensible sedan or a lightning-fast Ferrari? Your car insurance agent will need to know the make, model and age of your car to quote an accurate price for your policy. The Insurance Information Institute said car-specific factors include the purchase price, the safety record, engine size, repair costs, rates of theft and how much damage the vehicle could cause to another automobile in a crash.

Your Creditworthiness

In most states, laws permit insurance companies to review your credit-based insurance score as one way to help determine your rates. Credit-reporting company Experian said the scores indicate whether a policy applicant is likely to file insurance claims. According to insurance giant Allstate, factors that impact your credit-based insurance score include your on-time payment record, accounts that have gone to collection, how long you’ve had credit and your debt load compared to your credit limits.

Your Age

If you have a teenager, you know how expensive adding your child to your car insurance policy can be — an average of nearly $2,000 a year, USA Today reported. Rates go down as your child enters adulthood, especially at age 25, and continue to fall as they reach their 30s. But they won’t go down forever. A Forbes study shows that rates rise again in your mid-60s.

If your children are in high school or college, they might qualify for a good-student discount.

Your Gender

At least six states ban pricing for car insurance based on gender, but in the states that don’t, men often will pay higher premiums. That’s because statistics show women have fewer overall accidents and fewer accidents blamed on driving under the influence. A 2021 study from the Insurance Institute for Highway Safety said men are killed more often than women in car crashes because men are more likely to take part in risky driving behaviors.

Your Coverage

The insurance coverage you choose impacts your rates. A low deductible — the amount you’ll pay out of pocket per incident — often translates to a higher premium cost. So do the options, depending on whether your policy covers just the minimum required by law or has larger payouts in case of an accident.

You can’t change your age, but your actions do impact some of these factors, such as your credit history and the type of car. If you’re considering buying a different car, a call to your agent before you sign the paperwork will let you know what you’ll pay annually for your insurance.

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