Many analysts are predicting that insurance premiums will remain flat in 2011 -- maybe even go down. That's a relief to consumers who are seeing everything else go up, from gasoline to a loaf of bread.

The reason for lower car insurance rates: A decline in crashes and insurance claims, which have helped drop premiums by one or two percent a year from 2004 through 2009, according to data from the National Association of Insurance Commissioners. Also, consumers are doing a better job of shopping around and taking advantage of lower-cost providers.

"When the number of accidents goes down, fewer claims are filed, and that's one of the two main drivers of auto insurance rates," said Brian Sullivan, an insurance analyst and editor of the Auto Insurance Report newsletter.

The business of forecasting auto insurance rates can be a tricky one. For starters, insurance analysts have to sift through many indicators when making such forecasts, like the total number of crashes, the number of fatal crashes, the number and dollar amounts of insurance claims, average highway miles driven, the state of the economy, the cost of medical care and car repairs, improvements in auto safety technology -- the list goes on.

Sluggish Economy Means Less Driving

Many of these indicators are presently in flux, or moving in different directions. For example, due to the state of the economy, people are driving less, resulting in fewer insurance claims. The number of fatal accidents has been falling for a few years, but medical costs and repair costs are up. The incidence of auto insurance fraud has risen after several years of decline, but tort reform in some states has put a cap on the dollar amount that juries can award to plaintiffs in crash-related lawsuits. The rapid advance of high-tech safety features in vehicles has also helped reduce fatal crashes and serious injuries.

Since the recession began in '08, a lot of people have lost their jobs, or their income has decreased significantly. So people have been using their cars less than ever, which has clearly led to fewer crashes and fewer claims. "Insurers could afford to charge less," said Jeremy Bowler, an analyst at J.D. Power & Associates.

If the economy improves, and people start driving more, one might presume that premiums would go up. But, says Sullivan, the economy was strong in 2004-2005, and premiums went down even then.

While distracted driving has been a huge issue in the media, Sullivan says using cell phones and texting while driving has not translated into an increase in crashes or had an effect on insurance premiums. "It would seem to make sense that engaging in these activities would indeed be a big distraction for drivers, but the data just isn't there to show that the number of crashes are up as a result," he said.

The Geico Gekko

Another catalyst in the recent drop insurance rates has been the phenomenal increase in the amount of advertising done by insurance companies, particularly Progressive and Geico, said Bowler. "Those ad campaigns have created tremendous awareness in the minds of consumers. The message they constantly hear in all those ads is that you should price shop," he said. "So, that results in a drop in rates as well, because consumers are have been doing more price-shopping."

Whether you get a better rate if you make a habit of price-shopping and change insurers every few years, or if you stay with one company for a long time is a point of contention.

"It's definitely a good idea to shop a bit, although it's not something people want to spend a lot of time doing," says Sullivan. "I would say that the best thing to do is seek personal recommendations -- ask your friends and neighbors who they use, what they're paying, and if they're happy with the service."

On the other hand, some companies offer discounts if you've been with them for a long time. The data shows that there's a correlation between the length of time you've been with one company and how likely you are to make a claim. If you're inclined to remain with your current insurer, then call he company and make sure you're getting all the available discounts or good behavior and loyalty.

Sullivan cautions against using price as the only factor when shopping for insurers and choosing a new one. "It's not a good idea to buy based purely on price," he said. "Anyone can have a great, low rate if they don't answer the phones or pay out claims, so the cheapest might not necessarily be the best value."