Premiums are based on risk, and if there is a change in the risk, it normally results in a change in premiums. So, what are the risk factors? Well, the risk factors can vary from one insurer to another, but there are usually some common things like:

- The make, model and value of the car
- The driving history and age of the people driving the car
- Any modifications made to the car
- The policy holder's residential address
- Whether the car is financed or owned

If your premium goes up, it's probably because your insurer has had more claims from people in your age group, or in your suburb, or who drive the same type of car compared to the previous year - and because this experience is the best indicator of what's likely to happen in the future, it is used to set prices. For the same reason premiums for good drivers can also go down from one year to the next.

With some car insurance companies, people who really deserve to get the best price do, not the bad drivers who push the prices up for everyone else.

Tips for buying car insurance online

Virtually everything can be done online nowadays - from hotel reservations to flight bookings, and even purchasing car insurance (which is a fairly new addition). Yes, you can now get quick and comprehensive car insurance online, and the best news is that it can be much cheaper.

Aside from insuring with a credible company, there are some useful product features to look out for.

Let us take a look on some of them:

- Quality repairs with a lifetime guarantee
- Flexibility to choose your car's insured value
- Cover for the damage your car might cause - up to $20m
- Quick and easy online quotes