Nothing automatically increses when you level up (Both either youself or your companion), not even health as far as I am aware (Health increases with increasing your endurance stat). All that happens is that as you level you are able to use better gear that requires that level and are able to add a skill point for yourself with each new level and the opportunity to buy new abilities.

So the only thing that is free as such is one new skill point per level up, even new availble abilities will cost credits. Gear does not atumatically increase with your level, you have to either buy mods or upgrade your gear to level with you. You can use commendations ofcourse to upgrade gear and/or mods for moddable gear rather than credits but you stil have to earn these on your missions. There is no gaurantee that the loot you get will benefit your character or that it will be better than what you have, although the harder the mob you face the better your chances.

Crafting levels will tend to lag behind your current char level so often the gear you are currently able to craft is often worse that what you have, crafting itself costs remember beacuse you have to send out your companions on missions to gather materials which cost. Crafting is often just there to make some money in selling gear to lower levels on GTN. Nothing is given ourt for free in terms of your stats.

You comapnions gain new abilities and higher level versions of their old abilities automatically as you level up.

The only way to actively upgrade your companions is by improving their gear.

Nothing automatically increses when you level up (Both either youself or your companion), not even health as far as I am aware (Health increases with increasing your endurance stat). All that happens is that as you level you are able to use better gear that requires that level and are able to add a skill point for yourself with each new level and the opportunity to buy new abilities.

 

So the only thing that is free as such is one new skill point per level up, even new availble abilities will cost credits. Gear does not atumatically increase with your level, you have to either buy mods or upgrade your gear to level with you. You can use commendations ofcourse to upgrade gear and/or mods for moddable gear rather than credits but you stil have to earn these on your missions. There is no gaurantee that the loot you get will benefit your character or that it will be better than what you have, although the harder the mob you face the better your chances.

 

Crafting levels will tend to lag behind your current char level so often the gear you are currently able to craft is often worse that what you have, crafting itself costs remember beacuse you have to send out your companions on missions to gather materials which cost. Crafting is often just there to make some money in selling gear to lower levels on GTN. Nothing is given ourt for free in terms of your stats.

Health does increase slightly with level, but only the base amount, everything else is from gear/stims/buffs and skill tree.

The OP was asking about the companion skills (abilities, not crew skills or their gear). The Companion abilitiles are automatically added as you level and their ability ranks are upgraded at certain levels as well.