Which factor typically affects the cost of an insurance premium?

The cost of an insurance premium is influenced by various risk factors associated with the insured individual or entity, making the insured's credit score and claims history significant determinants. An individual's credit score can reflect their financial responsibility and reliability, which is a factor insurers consider when assessing risk. A higher score often leads to lower premiums since it suggests a lower likelihood of filing claims.

Additionally, a person's claims history is crucial; if an individual has a record of frequent claims, insurers may assess them as a higher risk and thus charge higher premiums. Conversely, a clean claims history generally results in more favorable premium rates, as it indicates that the insured may be less likely to file future claims.

Other factors listed do not directly correlate with the cost of premiums. The number of insurance agents in a company does not inherently impact the cost of premiums, as that relates more to distribution and service rather than risk assessment. The age of the insurance company could suggest stability but does not directly affect how much an individual pays. Finally, the availability of claims handling services pertains more to customer experience rather than the calculation of premiums based on individual risk profiles.