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Insurance companies spend a great deal paying insurance claims.

Auto insurance companies spend roughly $70 of every $100 collected on claim related expenses. The remaining $30 is split between company expenses, taxes, legal fees, and profits. Some years are better than others for auto insurance companies. In many cases, your auto insurance premiums will either rise or fall based on how it handles its claims experience and company expenses.

Thoroughly research how well an insurance company manages its business. It will give you a good indication of if/how your premiums are likely to increase/decrease. You can research companies by using services such as Standard and Poor's and Moody's. You should also check with the insurance department in your own state. See if they offer a complaint ranking, or insurance company complaint ratio ranking. A company doing well by their customers is usually going to be a company that will have a favorable complaint ratio.

Occaissionally, there will be a company that jumps into a market with low rates and performs poorly. Before you make a switch, do your homework to be sure that this is a sound company financially, and one that also takes care of it's insured's. In the long run, this is who you want to be insured with.