What’s the average cost of car insurance in America?
The average cost of car insurance is $1,502 per year, or $751 per six-month policy ($125.16 per month). Auto insurance costs vary widely based on individual rating factors. The Zebra’s team of licensed insurance experts crunched the numbers using a composite user profile and gathered rates from major auto insurance companies to develop these figures. Dive into the data below to see how age, gender, location, and vehicle type affect auto insurance premiums.
Which car insurance companies are the most affordable?
Car insurance rates by age and gender
Auto insurance quotes also vary depending on the driver’s age and their years of experience. Young and inexperienced drivers tend to be more dangerous behind the wheel, which is why insurance companies charge them higher auto insurance rates.
For example, an 18-year-old driver pays more than twice as much as a 25-year-old driver for auto insurance with all other factors held equal. Average rates gradually decrease with each year at young ages.
What else can affect average car insurance rates?
We’ve discussed how the following factors affect your car insurance premiums:
- State of residence
- Policy coverage
- Vehicle type
- Accident and credit history
But there are even more factors that can affect your car insurance rates:
- Driving experience
- Location within a state
- Insurance and claims history
Driving experience: Age affects car insurance rates, but so does the number of years you’ve been insured. If you’re a 30-year-old who’s held an insurance policy and been licensed since they were 16, you’re likely to get a cheaper rate than another 30-year-old who just took up driving.
Location within a state: Auto insurance is regulated differently in each state, leading to average prices for a full coverage policy ranging from just under $1,300 (Maine) to over $8,700 (Michigan). But even within a state, insurers considered certain locations, or territories in insurance terms, to be higher risk.
If you live in an area an insurer considers higher risk due to its rate of crashes, weather or crime, you may be subject to a higher rate than an equivalent driver living elsewhere.
Insurance and claims history: If you’ve maintained continuous auto insurance coverage, your insurer will be more confident that you’ve protected yourself and will usually charge a lower rate. Likewise, if you have a history of holding auto insurance policies without filing claims, you’ll get cheaper rates than someone who has filed claims in the past.
Mileage: Cars that are driven less frequently are less likely to be involved in a crash or other damaging event. Vehicles with lower annual mileage may qualify for slightly lower rates.
Discounts: Auto insurance companies offer a variety of discounts for those who take steps to become safer drivers or demonstrate responsible behavior. For example, adults can take defensive driving lessons, while young adults can qualify for good student discounts.
How car insurance premiums are calculated
An “average rate” is hard to calculate, thanks to the myriad rating factors contributing to any driver’s auto insurance premium.
Car insurance is designed — and priced — to suit each individual driver, accurately estimating the risk they represent to an insurer. While car insurance quote pricing varies by driver, it also varies by company. Between the cheapest company and the most expensive, you might find a substantial price gap.
Take the national average cost of car insurance with a grain of salt. To find an affordable policy, consult an insurance agent or compare as many companies as possible online.