How Much Does Car Insurance Cost?

How much does car insurance cost and how does it work? Read on to find out.

In case you’re on the lookout for car insurance, you probably have a ton of questions that you want to know the answers to. One of these questions would definitely be about how much does car insurance cost? The appropriate response, obviously, is that the cost depends on a number of different factors. Seeing how insurance suppliers figure car insurance rates can help you gauge your financial plan, yet additionally save some cash by understanding what to keep away from in the future.

The average cost of car insurance in the U.S. is around $1,134 each year, as indicated by a report from the National Association of Insurance Commissioners. These rates depend on the state you are living in, your driving record, age, conjugal status, FICO assessment, type of vehicle, insurance history, how much inclusion you choose to purchase and a lot of other different things. If you want to know more about how much does car insurance cost, then you have come to the right place. We have gathered all relevant information to help you understand everything that you need to know. So, what are you waiting for? Without much further ado, let us dive right in!

What is car insurance?

Car insurance, similar to life insurance and other insurance policies, is basically an agreement between you, the policyholder, and the insurance organization. You consent to pay a month to month or yearly premium, and the car insurance supplier provides you with financial protection from accidents that are covered for. However, there isn’t only one kind of coverage that makes up a car insurance policy: There’s liability coverage, personal injury protection, uninsured/underinsured driver coverage, comprehensive coverage and collision coverage.

Car insurance shields you from the monetary liability of harm you cause to someone else’s car, or a physical damage you cause to others with your car. Car insurance can likewise shield you from any damage caused to your own car, including harm from collisions, robbery, vandalism, and terrible climate. Without car insurance, you’d need to pay for expensive claims using cash on hand. This could put your own resources at monetary danger.

How does car insurance work?

At the point when you’re purchasing coverage, you’ll need to consider all the kinds of coverage you need, and the amount of coverage that you’ll require. In addition to this, you need to set coverage limits and pick a deductible sum for your coverages. At the point when you buy car insurance, your rates will be determined dependent on the amount of coverage you purchase together with individual components like your age, driving history, FICO assessment and the make and model of car you drive.

You’ll require your car insurance in the event that you cause a mishap or if your car is harmed or stolen. You set your car insurance to work by documenting a case, which is the way you reclaim your coverage. On the off chance that the event is covered, your insurance organization will pay for the expense of the harm you caused, or the harm to your car, contingent upon the circumstance. Furthermore, on the basis of where you reside, the guarantor may directly pay you.If not, then an installment might be made to the next party, to the person and/or company servicing the car, or to the clinical suppliers treating the other party’s wounds. In the event that your car is a rent, car insurance claim installments might be made out to your leaseholder or leaser.

Types of car insurance

As we referenced over, a car insurance strategy consists of various kinds of coverage that provide you with security in various circumstances. Here are the different types that make up a common car insurance strategy:

Liability coverage

Liability insurance takes care of the expenses on the off chance that you cause an accident, harm property or harm somebody with your vehicle. Liability insurance is needed in many states.

Personal injury protection (PIP)

Personal injury protection covers clinical and restoration costs in the event that you or your passengers are harmed in a car collision. It also additionally covers other related costs, similar to recovery, or lost wages, up to your coverage limits. A sort of no-fault coverage, PIP coverage can bring about a payout paying little mind to who was driving.

Collision coverage

Collision insurance covers harm to your own vehicle after a mishap, regardless of who was to blame. Collision insurance isn’t legally necessary, in any case, alongside comprehensive coverage, collision insurance helps make up what’s generally alluded to as “full coverage” car insurance.

Comprehensive coverage

Comprehensive coverage covers any damage caused to your car that can happen when it isn’t being driven, including harm from catastrophic climate conditions, falling articles, flood, fire, vandalism and burglary. In case you’re stowing away your car for long periods of time, you can as a rule decrease your car insurance coverage to simply comprehensive coverage. However, you need to ensure that you switch it back before you get back to driving once more.

Uninsured/underinsured motorist insurance

Uninsured/underinsured motorist coverage takes care of the expenses in case you’re in a mishap brought about by a driver who either doesn’t have insurance or whose insurance can’t pay for the full degree of the harm.

Gap insurance

In the event that your car gets stolen or totaled, collision or comprehensive will typically just compensate for the car’s actual cash value (ACV). Yet, that sum, which factors in depreciations, probably won’t cover the amount you actually owe on a car loan or rent. Gap insurance pays out the distinction, so you can take care of the credit or rent.

Roadside assistance

Roadside assistance, a discretionary coverage add-on, covers the kinds of crises that can leave you abandoned out and about, similar to punctured tire changes, jump starts, delivering fuel or towing to the closest specialist. Roadside assistance is typically economical to add to your approach.

How much does car insurance cost?

The average cost of car insurance in the U.S. is around $1,134 each year. However, remember that this relies upon factors that concern you, your car, and where you live. Car insurance rates cost about an average of $95 each month. As per NAIC, Americans pay around $611.12 every year for liability insurance (which incorporates bodily injury liability and property damage liability), $363.08 for collision coverage , and $159.72 for comprehensive coverage . In the event that you have no clue about any of these types of car insurances, make sure that you read this article and do some proper research online to see what you are getting yourself into. Some other types of car insurance incorporate personal injury protection (PIP) which ensures that you and your passengers are covered for, and uninsured motorist coverage for when the other party doesn’t have insurance coverage.

How much does car insurance cost in my state?

The area and state where you live can massively affect car insurance rates, on the grounds that each state has various guidelines and rules for auto insurance. Average expenses in the most costly states are at any rate twice as high as those in the least expensive ones. Maine is the least expensive state for full coverage car insurance with a yearly average rate of $963, followed by Ohio and Idaho. Louisiana is the most highly expensive state for full coverage car insurance at $2,762 each year by and large. Michigan and Kentucky are not very far off from Louisiana either in terms of high rates. Let us look at average car insurance costs according to state:

Alabama                      $1,501

Alaska                         $1,521

Arizona                        $1,536

Arkansas                     $1,883

California                     $1,911

Colorado                     $2,012

Connecticut                 $1,791

Delaware                     $1,733

Florida                         $2,321

Georgia                       $1,820

Hawaii                         $1,049

Idaho                           $998

Illinois                          $1,397

Indiana            $1,179

Iowa                            $1,151

Kansas                        $1,600

Kentucky                     $2,363

Louisiana                     $2,762

Maine                          $963

Maryland                     $1,872

Massachusetts            $1,100

Michigan                     $2,387

Minnesota                   $1,418

Mississippi                   $1,636

Missouri                       $1,526

Montana                      $1,726

Nebraska                    $1,376

Nevada                       $2,161

New Hampshire          $1,169

New Jersey                 $1,860

New Mexico                $1,418

New York                    $2,131

North Carolina             $1,212

North Dakota              $1,195

Ohio                            $989

Oklahoma                   $1,748

Oregon                        $1,358

Pennsylvania              $1,406

Rhode Island               $2,043

South Carolina            $1,652

South Dakota              $1,455

Tennessee                  $1,298

Texas                          $1,610

Utah                            $1,390

Vermont                      $1,123

Virginia                        $1,248

Washington                 $1,234

Washington, D.C.        $1,880

West Virginia               $1,605

Wisconsin                    $1,160

Wyoming                     $1,369

Average car insurance costs by company

Each car insurance organization sets rates dependent on many components, including your driving history, area, vehicle and socioeconomics. They’re making an informed theory about the fact that you are so prone to document a case later on and setting your cost likewise. Every safety net provider treats each factor in a different way. In the event that you have a poor credit, one insurer may charge you 10% more for the approach, while another would charge 40% more. A markdown for being free of any claims and debts may procure you a 20% rebate with one organization and 5% at another. This results in different rates altogether starting with one individual then onto the next. This is the reason the organization that gives your friend super-low rates probably won’t be the least expensive or the best option for you. Here are yearly rates for a significant number of the country’s biggest insurance companies:

Erie                                                      $1,191

NJM                                                    $1,221

Geico                                                  $1,268

Auto-Owners                                       $1,277

Texas Farm Bureau Insurance           $1,361

American National                              $1,432

Amica                                                  $1,447

Travelers                                             $1,464

State Farm                                          $1,491

Progressive                                         $1,562

Shelter                                                 $1,718

Chubb                                                 $1,769

Farmers                                              $1,830

Auto Club of So-Cal AAA                   $1,888

Allstate                                    $2,381

USAA                                                  $1,169

Average cost of car insurance by age

Age is maybe perhaps the greatest factor for the amount you will pay for car insurance. All things considered, drivers who are young typically have to compensate more for insurance than drivers who are older, in spite of the fact that rates can start to crawl up again as drivers approach 80 years old. Everything reduces to experience and chance. Young drivers have crash rates that are approximately four times higher that of more experienced drivers. Insurance organizations know about the way that teenagers and youthful drivers — just as the old — are bound to get in a mishap, so the car insurance costs that these drivers pay are normally higher to make up for the more serious danger.

A 18-year-old driver, for instance, pays an average amount of over 2.5 times as much each year for full coverage insurance as a 25-year old driver. High school drivers can counterbalance expanded rates now and again, as on the off chance that they are added to their parents’ arrangements since they might have the option to exploit multi-car and vehicle utilization discounts.

16-year-old      $7,371

18-year-old      $5,385

25-year-old      $1,989

30-year-old      $1,737

40-year-old      $1,674

60-year-old      $1,405

Note that the cost for 16 year olds is the combined rate for teens + parents using their parents’ car insurance policy.

Average cost of car insurance for men and women

You must also remember that gender too is a major factor in affecting the expense of car insurance, with men ordinarily being more costly to safeguard than women. In most cases it is seen that men usually participate in more dangerous driving practices as compared to women. This includes driving under the influence of certain medications or alcohol, not wearing a safety belt and speeding, all of which can prompt more serious mishaps.

The distinction in insurance rates is more articulated with drivers who are more young, with 18-year-old men paying $744 each year more than what 18-year-old women pay for full coverage. The mix of young drivers being more inexperienced and men being generally riskier usually makes them among the most costly drivers to guarantee. When drivers reach their 40s and//or more, the average expense difference between the sexes dips under $100 each year for full coverage.

Male                Female

18-year-old      $5,727             $4,983

25-year-old      $2,046             $1,932

40-year-old      $1,648             $1,701

60-year-old      $1,421             $1,389

Average car insurance rates after an at-fault accident

Average car insurance rates for an at-fault driver after an accident are:

$2,439 per year for full coverage.

$884 per year for minimum coverage.

Overall, car insurance rates are twice as much higher for a driver who has caused an accident as compared to one who hasn’t. All things considered, insurance rates differ from one state to another. Even if rates increase after an accident, they usually tend to stay in the 30% to 60% range. However, there are some exceptions. For example, in California, Massachusetts and North Carolina, rates increase by more than 70% on average after an accident. In California, that means an extra $1,049 per year in car insurance charges.

The extent to which your rates will increase likewise depend upon how serious the damage is and whether you have accident forgiveness on your insurance plan or any “great driver” discounts you remain to lose. Mishaps bringing about clinical expenses can be extravagant and result in considerably more extreme rate increments.

It’s imperative to search for the least expensive safety net provider after a mishap, on the grounds that each organization considers factors like an accident diversely in setting costs. American Family expands car insurance rates by about 11% on average after an accident, while rates at The Hartford and 21st Century increase more than 50%. Causing an accident can lead to your collision protection costs being increased for three to five years thereafter, contingent upon the carrier. This is the reason it’s insightful to search for car insurance quotes soon after the third and fifth commemoration of your accident to check whether you can score a better deal.

Average car insurance costs for good and bad credit

Having a poor credit generally has a major effect on car insurance rates in many states. All things considered, car insurance rates for drivers with a terrible credit are over 75% higher than for individuals with an excellent credit. Average car insurance rates for a driver with a poor credit score are:

$2,812 per year for full coverage.

$984 per year for minimum coverage.

Guarantors utilize a “credit-based insurance score,” like a normal financial assessment, to help set rates in many states. The insurance score generally utilizes similar elements as a standard FICO rating. These things include factors such as paying all your installments on time and wrongdoings. However, the insurance score will gauge them in a different way. Insurance organizations highlight information connecting poor credit to more regular insurance claims to legitimize the high costs to state controllers. The score’s effect on your expense relies upon where you reside and which car insurance organization you pick. In four states — California, Hawaii, Massachusetts and Michigan — car insurance pricing based on a person’s loan history is restricted by law.

Average cost of car insurance by vehicle

The make and model of your vehicle will also definitely influence car insurance rates. Safety net providers charge more to cover certain cars, including:

Sports cars, which have higher maximum velocities. Individuals will in general drive them quicker, improving the probability of an accident or violation of traffic rules. In the event that you get a speeding ticket, insurance companies think you’ll be bound to cause a mishap, which expands rates further.

Luxury cars since they will in general have costly parts and other items that are highly expensive to replace whenever harmed in an accident.

Electric vehicles, which have more costly motor parts to supplant, particularly the batteries, which can cost thousands of dollars each.

The average cost of car insurance is given below on the basis of vehicles used:

Subaru Outback                     $1,392

Jeep Wrangler                        $1,416

Honda CR-V                           1,439

Subaru Forester                      $1,465

Ford Escape                           $1,476

Ford F-150                              $1,505

Chevrolet Equinox                  $1,511

Jeep Cherokee                       $1,521

Toyota Tacoma                      $1,527

Toyota RAV4                          $1,555

Nissan Rogue                         $1,585

Grand Cherokee                     $1,592

Dodge Ram 1500                   $1,615

GMC Sierra 1500                   $1,622

Ford Explorer                          $1,641

Honda Accord                         $1,667

Hyundai Elantra                      $1,673

Toyota Corolla                        $1,701

Toyota Camry                         $1,704

Honda Civic                            $1,720

Chevrolet Silverado 1500       $1,724

Nissan Sentra                         $1,724

Toyota Highlander                  $1,773

Nissan Altima                          $1,781

Tesla Model 3                         $2,215

Factors that affect the average cost of car insurance

  • The type of car insurance strategy. The type(s) of car insurance you purchase assumes an enormous part in deciding the expense. A state-minimum liability strategy will probably cost less than a car insurance bundle including comprehensive insurance, collision insurance, accident forgiveness and personal injury protection.
  • Your age. Drivers in various age groups present various dangers, which is the reason rates will differ in general depending on how old the insurance strategy holder is.
  • The area you live in. Topography, climate and populace thickness are altogether factors in the cost of your car insurance.
  • Your driving record. Insurance suppliers need to see responsible behaviour by the driver, which is the reason car crashes and references are factors in deciding car insurance rates. You must not forget that the points on your license will not remain there permanently. However, the amount of time they stay on your driving record will be different on the basis of the state you live in and the seriousness of the offense.
  • What type of car you drive. The value, style and age of your vehicle all add to how much car insurance costs will be. For example, a pristine sports car will probably be more expensive than, say, a five-year-old car.
  • Your deductible. On the off chance that you pick a lower deductible, it will bring about a higher insurance bill – which makes picking a higher deductible appear to be a very decent arrangement. Be that as it may, a higher deductible could mean paying more cash out of your own pocket in case of a mishap.
  • Your strategy limit(s). Albeit all auto strategies have a base sum, you can likewise raise your strategy limits relying upon the degree of assurance you need.
  • Your qualification for discounts. Cross country offers an assortment of discounts on collision protection. You can get a good deal on your month to month bill by packaging approaches, going paperless, driving mishap free and a lot more.
  • Change of residence. Regardless of whether your new home is just a traffic light away from your past address, if it’s in an alternate postal district, your accident protection rate could change. Auto strategies differ in cost from one state to another too.

How to save money on car insurance?

Most car insurance carriers give limits and discounts that can bring down the expense of your insurance charge. The specific discounts shift among insurance suppliers, yet there are a small bunch of standard accident coverage limits. At the point when you purchase an insurance strategy, make a point to get some information about every one of the reserve funds accessible to you. Here are probably the most well-known insurance limits:

  • Safe driver discounts: Most car insurance suppliers offer safe driver discounts for drivers who have finished a qualified security course within the recent years.
  • Claims free: Drivers who have no claims on their record from the previous couple of years typically fit the bill for investment funds.
  • Multi-car discounts: If your family has various vehicles, consider putting them all on one insurance strategy to meet all requirements for a multi-car rebate.
  • Building insurance policies: You can frequently decrease your car insurance premium when you group your car insurance strategy with a life or home insurance strategy.
  • Great student discounts: Many insurance carriers offer limits for young drivers with passing marks in school. Normally, full-time students younger than 25 who keep an average of a B grade or better are qualified for this rebate. You will probably have to give scholarly proof as a state-of-the-art grade report or a structure endorsed by a school director.
  • Paying completely: If you can bear to cover your yearly car insurance charge, you may set aside cash. Numerous insurance organizations give a rebate to those drivers willing to pay forthright in light of the fact that it is more advantageous and requires less preparing for them.
  • Security highlights: If your car has basic wellbeing highlights, as airbags, an enemy of robbery gadget or automated stopping devices, some accident protection organizations will apply a rebate to your strategy.

Is full coverage car insurance worth it?

Full car coverage might be awesome, contingent upon your conditions. On the off chance that you drive frequently, have a car credit or if your car is still generally new, you might need to consider full coverage insurance. In spite of the fact that it is for the most part more costly than least coverage, there is the additional advantage of having more powerful coverage accessible to you in case of an insurance guarantee. Most insurance organizations offer a scope of coverage levels, from state least required cutoff points and up to a large portion of 1,000,000 dollars in real injury coverage per mishap, and perhaps much higher. Car insurance is frequently ready to be modified to your interesting requirements.


Now that you have read this article, you know all about how much does car insurance cost. Remember that car insurance rates depend on a number of factors. Make sure to do your proper research before to see what works best for you before you make a final decision.

Sandra Johnson

Sandra Johnson

Sandra Johnson was a few years out of school and took a job as a life insurance agent in California, selling coverage door-to-door for Prudential. The experience taught her about the technical components of insurance and its benefits for individuals and society, as well as the misunderstandings people often have about insurance. She has over ten years’ experience in the insurance industry, having worked as both a Broker and Underwriter, assisting clients across a broad range of industries. At Insurance Noon, Sarah diligently gathers all the required information and curates up pieces to provide meaningful insurance solutions. Her personal value proposition is to demonstrate a genuine interest in always adding value for clients.Her determined approach to guiding clients has turned her into a platinum adviser to multiple insurers.

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