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How Insurers Determine Your Premium: An Interview with Jon Merwin of Portsmouth Atlantic Insurance

By Jon Merwin

Tell us a little bit about your company and its foundation.

I started the agency in June of 2005 when I graduated from UNH (Liberal Arts Degree in Communication). I started with no experience in insurance and quickly learned how to sell and service insurance policies after opening for business. My mother, Cathy Merwin, started working for the agency a few years later and we actually co-own the business together. We originally started as a partnership/franchise of another, larger insurance agency in Salem, NH before branching off and becoming completely independent. We started out in Laconia, NH (my father is a State Farm agent in Laconia and I grew up in Gilford, NH so it made sense to start close to home) before moving the business to Portsmouth and changing the name to Portsmouth Atlantic Insurance. After living in Durham/attending UNH for several years I became a big fan of the Seacoast and chose Portsmouth as the area where I would live and grow the business. Our focus over the years has been primarily personal lines insurance (home and auto, generally speaking), however we've recently started selling commercial lines coverage as well. Our company philosophy has always been to provide our clients with the best educated and knowledgeable personal service so that we maintain a long term customer relationship. We continue to use environmentally friendly practices and continue to be the greenest insurance agency in NH.

First off, what is the definition of an insurance premium?

A premium is the fee an insured pays to an insurer for a policy that provides coverage for specified perils.

What factors do insurance companies use to determine your premium?

There are a number of factors insurance companies use to determine premium. Sometimes these factors overlap and other times there are unique factors for each company in determining premium. The most common are age, sex, marital status, highest level of education, occupation and location/address. The "Protection Class" of a town/city also has a heavy impact on premiums, meaning how well are the homes in a town/city protected against fire? The amount of fire departments in the town, whether the FD is fully manned or volunteer, how many paved roads vs. dirt roads in the town, are there fire hydrants, etc. With regards to auto insurance, your driving history has a big impact. Insurance companies will take into account accidents and violations going as far back as five years in order to determine premium. Another large impact on auto and home premiums is continuous insurance. For auto insurance, if you've had continuous insurance with an insurance company for at least six years, your rate will be much cheaper if you decide to switch to a new company because you've had continuous/uninterrupted coverage. One's "insurance score" also has a big impact on home and auto insurance premiums, an insurance score is determined behind the scenes by the insurance companies and they will use as much as 150 different variables in determining one's insurance score. One's credit score has a lot to do with the insurance score that's determined by each insurance company.

Is there any way to receive a reasonable premium with a low credit score?

It's difficult. As I mentioned above, the insurance score that companies use to determine premiums is heavily weighted by ones credit score. NH allows for insurance scoring and almost all insurance companies use this practice. I believe there are only one or two insurance companies left that do not use an insurance score. My recommendation to people would be to contact an independent agency and ask what your options are. They may represent a company that does not weigh the insurance score so heavily in determining the rate or they may represent a company that does not insurance score at all. As I mentioned above, there are a number of other ways to receive lower rates even with a low credit score (good driving record, good home claims history, homeowner discount, education discount, occupation discount, ones commute to work, annual mileage, etc). Some of the discounts are within the control of the insured and others are out of control.

What's the best way for people to get in contact with you and your company?

The best way to contact us is by phone (603-431-4020) or email ( Our fax is 888-336-0601 and we have walk in customers from time to time at our office location of 601 Islington St, Suite 101, Portsmouth NH 03801 (our office is attached a popular coffee shop called White Heron). We have several insurance agents in the office with years of experience and we're happy to help with any questions, quote requests or comments.

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