AUGUSTA – The latest study of auto insurance costs by the National Association of Insurance Commissioners has both good news and bad news for Mainers. The good news is that Maine ranks 50th in the nation for the average premium cost of combined liability, collision and comprehensive auto insurance. Only Iowa had lower rates among the 50 states and the District of Columbia. The bad news is the state experienced the fourth highest percentage increase in premium costs between 1996 and 2000, the years examined by the study.

“Maine consistently has been in the bottom five,” state Insurance Superintendent Allessandro Iuppa said recently, “and this is one of those rankings where being at the bottom is a good thing. And I don’t see anything on the horizon that’s going to indicate a change.”

While the average premium for combined liability, collision and comprehensive insurance in Maine was just a few cents under $600 in 2000, Iuppa said some Mainers pay a lot more while others pay less based on where they live and on other factors such as their individual driving records.

For instance, rates typically are higher in urban areas.

“You are more likely to be involved in an accident where there are more cars and trucks on the road,” he said. “And obviously, you are going to find more trucks on the road and cars on the road in the Greater Portland area than you would perhaps in Rumford.”

Another major factor, Iuppa said, is an individual’s driving record. He said when he has talked with a consumer complaining about high insurance rates, a poor driving record is often the reason for the higher rates.

“When I start peeling back the onion and asking the questions about motor vehicle violations, invariably [I am told], ‘Well it was just a couple of speeding tickets I had this year,'” he said. “Those are one of the things that cause one’s auto insurance rates to escalate.”

But even when Mainers pay higher rates, they still are far lower than in many states. For example, the average yearly premium for liability coverage in Maine was $293.38 in 2000, ranking Maine 42nd in the country. In New Hampshire the average was $373.20 and in Massachusetts it was $596.58.

Maine ranked 43rd for collision insurance, with an average premium of $206.24 in 2000, and ranked 49th for comprehensive insurance, with an average of $100.27.

Liability insurance pays when an insured person is legally liable for bodily injury or death caused by that person’s vehicle. Collision insurance pays for loss to a covered vehicle when it collides with another object or overturns. Comprehensive insurance pays for loss or damage to a covered vehicle caused by any event other than collision.

Other factors can also affect car insurance costs, such as having a young driver in the household – even if that person has his own vehicle and doesn’t drive the family car regularly.

One factor affecting premiums that may surprise – or anger – some is the insurance buyer’s credit rating.

“What the insurance companies are doing here is ridiculous and, more importantly, it is unfair,” said J. Robert Hunter, the insurance director for the watchdog group Consumer Federation of America. “You can understand why insurance might cost more in Portland, with greater traffic density than, say, in Rangeley, but I have never been able to get an explanation as to why if you have a poor credit rating because you don’t use credit cards, why that should have an impact on what you should pay for insurance.”

Maine, like most states, allows the practice. Hunter said some states, like Maryland, banned the use of credit ratings in determining insurance rates after an independent study found little correlation between a person’s credit history and his driving record.

Michael Moran, a spokesman for the American Insurance Association, a national trade group, said there are several studies that indicate there is a correlation between creditworthiness and whether a person is a good risk for insurance companies. He said the actual mathematical formulas used in the credit scoring process are different for each company and are the property of those firms.

Iuppa said Maine is reviewing the use of credit scoring. But he said the practice does not increase the average cost of car insurance in the state, it just means lower rates for some individuals and higher rates for others.

Christy Rowell, an insurance agent in Hallowell, is president of the Maine Insurance Agents Association. She said Friday that while Mainers on average have lower insurance costs than most, some will see higher rates as insurance companies become more aggressive in determining individual rates.

“One carrier contracted with an independent vendor to check drivers’ history [records] to see if they had disclosed all of their record to the agent,” she said, “and some people have had their policies canceled after these independent computer checks.”

She said one vendor checked all the names of license holders at a particular address against a list of policyholders in an effort to find undisclosed drivers at the same address. “The problem was they did not differentiate between different apartments at the same address,” she said, “and people were getting letters and then calling agents to complain.”