By Jim Donovan

By Jim Donovan

PHILADELPHIA (CBS) — Is the cost of car insurance driving you into the poor house? Shopping around for lower rates can often save you hundreds if not thousands of dollars a year, but have you ever wondered how those insurance rates are determined in the first place?

In today’s 3 On Your Side consumer report, you may be surprised to learn that your premium often has little to do with your driving history.

With millions of vehicles on the road you’d think that figuring out who pays what for auto insurance would be pretty straight forward and involve things like your age, the type of car you drive, where you live, and how much you drive but that isn’t all.

“What most drivers don’t realize is that your personal financial data pays just as large of a role in the rate you pay for auto insurance as all those other things,” said Kevin Brasler, executive editor of Delaware Valley Consumers’ Checkbook.

In fact with most companies, your credit history may matter more than your driving record! “It’s extraordinary how much more companies are now charging people with fair credit or lousy credit compared to people who have just lousy driving records,” said Brasler.

Delaware Valley Consumers’ Checkbook did extensive research on insurance rates and Brasler says companies are increasingly relying on credit scores and secretive formulas to set their rates.

“If you ask the insurance companies they’ll say, well we write according to the risk and these drivers who have lousy credit are riskier than drivers with excellent credit. But they’ve never been able to prove that. The one thing they’ve been able to prove is that drivers with fair credit are more likely to file claims than they are, then people with excellent credit. But it has nothing to do with their driving records,” said Brasler.

So someone with two speeding tickets could be paying less than someone with a clean driving record, but a bad credit history!

You still want to shop around for the best rates, but also pay attention to your credit report. They often contain mistakes that could lead you to pay more for insurance than you have to.

For more information about how insurance rates are determined, and how you can shop around for a lower rate, visit this link through next week: