What affects insurance company Premiums?

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The expense of paying for accidents and the costs associated with settling them is the key factor in setting the rate for your car insurance. Marketing the insurance, commissions, expenses and advertising, and overhead general office expenses and salaries are other expenses related to insurance.
Some of these expenses are somewhat offset by the investment earnings of the premium money that have been received from customers. Lasting for several years is the car insurance underwriting results that generally follow a cycle. There seem to be some good years that are then followed by a couple bad years and then returning to good again. If the investment earnings are in their good time, they can offset losses i underwriting and can offset expenses.
In a way for investment earnings to build profits, some companies like to have surpluses over and beyond underwriting and expenses. Another thing that can effect premiums is that many states require insurance companies to have a minimum of cash reserves. Since the insurance companies cannot foresee the future, they will pick those who seem to be good risks and they will look at many classification factors for potential customers.