Car insurance premiums are highly individualized, making it hard to know how much you’ll pay before you get a quote. but there are some general rules to help you get a general idea of prices.
for example, if you have a history of driving under the influence, the cost of your car insurance will be much more expensive than someone with a clean driving record. But there are many more factors that determine the price of your auto insurance, including your age, where you live, and driving history.
This makes it difficult to estimate your individual auto insurance quote. but there are some general rules that can help you get a better idea of what to expect. for example, a sports car generally costs more to insure than a minivan. Similarly, younger drivers can generally expect higher car insurance premiums than older drivers. And a driver with a DUI or speeding tickets may have higher rates than one with a clean record.
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Here’s a breakdown of the average cost of auto insurance by various factors, including age, state, company, and driving history.
the average cost of car insurance
A 40-year-old male or female driver with a clean driving record and good credit in the United States can expect to pay an average of $1,771 per year, or about $148 per month, for auto insurance coverage. total. The minimum cost of insurance, the basics you’d need to buy to legally drive in your state, averages $545 per year.
average cost of total coverage by insurance company
These are averages across all categories. you’ll probably end up falling somewhere above or below these numbers, depending on your particular situation. Let’s break down the various factors.
how much does auto insurance cost by state?
Insurance providers must work with each state when setting rates. State insurance departments generally need to approve company rates in advance, so insurance costs vary from state to state.
Here are the five most expensive states for auto insurance:
- new york: $2,996 per year – 69% above national average
- louisiana: $2,864 per year – 62% above national average
- florida: $2,762 per year – 56% above national average
- nevada: $2,426 per year – 37% above national average
- michigan: $2,345 per year – 32% above national average
And here are the five cheapest states for auto insurance:
- maine: $876 per year – 51% below the national average
- vermont: $1,000 per year – 44% below the national average
- idaho: $1,065 per year – 40% below national average
- new hampshire: $1,182 per year – 33% below national average
- ohio: $1,200 per year – 32% below national average
average annual cost of auto insurance by state
How much does car insurance cost by age and gender?
Age is one of the most important factors determining the cost of your auto insurance. In general, the older you get, the cheaper your auto insurance bill. car insurance policies for teens and young drivers are the most expensive.
Premiums for teen drivers can be astronomical: The national average cost for adding a 16-year-old driver to a parent’s full-coverage policy is $3,852 per year. From there, the costs begin to decrease. When a driver reaches age 25, annual premiums for comprehensive coverage drop to around $2,000 per year.
Your gender also affects your auto insurance costs, but this disparity decreases as drivers age. In general, insurance costs by gender are also highly dependent on the age of the driver.
Teen boys are the most expensive drivers to insure, with 16-year-old boys in particular being the most expensive. That’s because teenage boys tend to be involved in more serious car accidents and engage in riskier driving behavior than their female cohorts, according to the CDC.
For this reason, 18-year-old men can pay $800 more in auto insurance premiums than 18-year-old women. however, by the time drivers hit their 40s, the gender gap is just $50, with women becoming more expensive to insure. by the time he hits 60, the difference is less than $20, and men’s policies cost a bit more.
average annual premium by age and sex
other factors that could affect the price you pay for car insurance
driving history
Your driving record is a double-edged sword. drive well and you could receive a safe driving discount, but drive poorly and you may see a surcharge on your bill at your next renewal.
Insurers, including Geico and Progressive, often have telematics programs that use your smartphone or car docking device to analyze your driving habits, check speed, slam on the brakes, or use your phone while driving. Establishing a good driving record through telematics can make you eligible for safe driving discounts.
however, receiving a speeding ticket could increase your annual premium by $367 on average, while a dui could increase it by $1,650. an at-fault accident can also increase the cost of your bill.
credit history
Insurers may use your credit history when calculating a quote, and your credit score could affect your premiums, depending on where you live. Some states, including Massachusetts and California, prohibit insurers from considering credit history when calculating a quote.
vehicle type
The type of vehicle you drive can have a big impact on your auto insurance bill. Luxury or sports cars, like BMWs or Mercedes-Benz, typically cost more to insure than budget cars like Toyotas or Hondas. There are a couple of reasons for this, including differences in the price and availability of auto parts for certain makes and models, as well as the vehicle’s safety record and accident prevention features.
annual mileage
Carriers often offer discounts if you have low annual miles, meaning you drive fewer than the average number of miles per year compared to other Americans. You may be considered a low-mileage driver if you drive less than 7,500 miles per year, which could be good news for remote workers. The average annual premium for Americans who drive 5,000 miles or less per year is $1,612 (about $150 less than the national average), according to Bankrate.
type of coverage
The more coverage you buy and the lower your deductible, which refers to the amount you pay out of pocket before your insurance kicks in, the higher your monthly or annual premiums are likely to be. Conversely, the less coverage you buy and the higher your deductible, the lower your annual premiums will be. however, setting your deductible too high and reducing your coverage options can leave you vulnerable to larger losses if an accident occurs and could cost you a significant amount of money.
here’s how to decide how much auto insurance you need to keep costs down, without putting your finances in jeopardy.
insurance history
The longer you’ve had car insurance while you were a licensed driver, the lower your rates can be. Also, some companies offer discounts for having continuous auto insurance over a period of time. and this does not necessarily have to be with the same insurer. Progressive, for example, includes time with your previous insurer for your continued insurance discount.
how to find the best car insurance rates
Comparing is essential to finding the best auto insurance rates. The Insurance Information Institute recommends getting at least three quotes from a mix of national and regional insurers, says Mark Friedlander, director of corporate communications.
“We like to tell people to do an apples-to-apples comparison, meaning same coverage levels and same deductibles,” friedlander said. “And insurers offer a variety of discounts at different levels, and you may be able to get a better price based on the discounts alone.”
A good time to check your policy and get new quotes is at your renewal period, which is usually every six to 12 months.
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