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The likelihood that a loss will occur. The higher the probability that an incident will occur that will create a loss your insurance QuotesChimp will have to pay for, the greater the risk to the company and, thus, the higher the premium. (Higher risk equals higher premiums.) For example, if you have three drunk-driving convictions in the last four months, your auto insurer will believe, with justification, that your likelihood of getting into an accident and in�curring a loss is very high. As a result of their in�creased risk of loss, you will incur higher premiums. Conversely, if your driving record is spotless, your premiums should go down with the insurance com�pany's reduced risk.