How much does a typical American spend on auto insurance? What is the typical cost of auto insurance for different age groups and genders?
In order to answer these questions, we compiled information from a wide variety of reputable auto insurance databases. Some findings confirmed our preconceptions, such as the high rates of increase in vehicle insurance premiums for young drivers.
The fact that having a low credit score has an effect on your insurance rates similar to that of driving under the influence was only one of several unexpected findings (DUI).
Read on for the most up-to-date data available on the typical price of car insurance.
The typical annual premium for full coverage auto insurance is $1,569.
Car insurance costs more than twice as much for teenagers as they do for drivers of any other age group.
Drivers in their 50s have the lowest car insurance rates
Rates for new drivers under the age of 25 is greater for young men than for new female drivers, but the gap closes for drivers aged 25 and up.
Car insurance premiums are highest for hybrids than for sedans.
The average annual cost of auto insurance in Michigan is $3,096; this is approximately $700 more than the cost in second-place Louisiana.
At $885 annually, USAA has the lowest vehicle insurance rates of any major insurer.
In most cases, your insurance will increase by 75% if you drive while impaired.
Except in the rare areas that don’t allow carriers to utilize credit ratings, bad-credit drivers pay 71% more than good-credit drivers.
The various forms of auto coverage
First, we’ll go over the many kinds of automobile insurance out there, and only then will we get into the average premiums people pay.
Car insurance comes in four basic varieties:
Property damage liability coverage: Covers damage to another person’s property caused by an accident in which the policyholder is at fault.
Bodily injury liability coverage: Pays for another person’s medical bills when the policyholder is at fault in an accident.
Collision coverage: Protects the policyholder’s car from damage caused by an accident in which they are at fault.
Comprehensive coverage pays for damage to the policyholder’s car that is not the result of an accident, like as theft or weather.
Except for two states (New Hampshire and Virginia), all drivers must have liability insurance. Drivers must be able to pay for property damage and physical injury resulting from an automobile accident in the two states that do not mandate it. Even in states where liability insurance is not required, it is still the most practical alternative for most drivers.
The minimum amount of liability insurance required by law varies by state and is commonly referred to as a minimum coverage policy. In one jurisdiction, for example, the minimum coverage could be $10,000 in property damage liability and $25,000 in bodily injury liability.
A comprehensive coverage policy includes all four categories of coverage described above. The features and pricing of these plans might vary greatly based on what the motorist desires.
Car insurance costs an average of $1,569 per year.
According to data from Coverage.com, Insure.com, The Zebra State of Auto Insurance 2019, and U.S. News, the average vehicle insurance rate for full coverage is $1,569 per year.
In terms of monthly costs, the average car insurance policy is around $131. Plan on getting an approximate estimate of your vehicle insurance expenses.
According to Coverage, the average yearly cost of minimum coverage is $545
The cost of auto insurance often rises with each passing year. In a study conducted by The Zebra, average annual auto insurance premiums were found to have increased by 29.6 percent since 2011. However, there may be large fluctuations from one year to the next. The average premium was reduced by 6.3% in 2013. In some years, the rate of inflation has reached 6.9 percent.
Average auto insurance rates by age Various Ages Ratio of the average annual rate (full coverage) Teens $5,023 20s $1,989 30s $1,532 40s $1,474 50s $1,365 60s $1,384 70s $1,611 80s $1,880. According to Zebra’s data (2020).
Teenagers are more likely to be in collisions, therefore their insurance premiums reflect that risk. That’s because kids have less practice driving and are more likely to take risks.
Those who don’t make claims on their insurance will notice a significant reduction in their premiums if they keep their driving records clean. A 16-year-old pays an average annual premium of $6,600, but a 20-year-old pays less than $2,000.
Car insurance costs vary by gender
It’s commonly accepted that male drivers incur higher premiums than female drivers. That’s not quite right.
According to Zebra’s research, men teenage drivers pay more than females for car insurance on average. In terms of average cost, teenage male drivers pay 14% more than teenage female drivers. And male 20- to 24-year-old drivers pay 8 percent more than their female counterparts.
When comparing auto insurance quotes, age 25 and up no longer makes a significant impact. When comparing rates for seasoned drivers, here is how much each gender should expect to pay:
Rates by Gendered Annually (full coverage) Dollars and cents: Women $1,480; Men $1,470
Instances of the Zebra (2020).
In order to prevent insurance companies from charging different drivers different prices based on their gender, seven states have passed legislation to outlaw this practise. Many states now permit citizens to select nonbinary gender classifications, thus there will certainly be more who join them.
To obtain the most affordable policy if you believe you are being charged extra as a result of your gender, compare multiple quotations.
What each car type can expect to pay on average for insurance class of automobile Ratio of the average annual rate (full coverage) Hybrid $2,343 Cost of a Sedan: $2,242 SUV: $1,868 Truck: $1,741 Van: $1,602
Information was gathered from Insure.com and The Zebra (2020).
Insurance for a van is the most affordable option, saving drivers $640 per year compared to the insurance for a sedan.
Saving money at the gas pump isn’t worth paying extra for insurance on a hybrid. Due to their greater repair expenses, that is.
If you’re curious about how much Tesla insurance costs, Insure.com reports an average premium of $3,110 per year. The Tesla Model S averaged an insurance premium of $3,476 per year, placing it in the top ten most costly vehicles ranked by The Zebra.
A state-by-state breakdown of average auto insurance premiums Ratio of the average annual rate (full coverage) Ratio of the average annual rate (minimum coverage) 1.45 dollars and 55 dollars for the state of Alabama Alaska $1,275 $478 To the State of Arizona: $1,470 $614 To the tune of $1,698 in Arkansas and $608 elsewhere Located in: California $1,868 $648 1,757 dollars and $673 dollars in Colorado. New York $1,816 $1,803 $922 in Delaware City of Washington, DC $1,383 $633 $2,309 against $1,102 for the state of Florida $1,609 $679 in Georgia $1,045 + $411 = Hawaii Idaho $1,164 $394 $1,303 in Illinois $464 In the state of Indiana, $1,165 is needed to cover the $438 Iowa $1,106 $304 $1,622 and $483 in Kansas Spending in Kentucky: $2,208.973 Amount: $2,379 $983 Louisiana Maine $935 $374 $1,415.691 in Maryland $1,463 $606 for the state of Massachusetts $3,096.1745 in Michigan Budget: $1,319 $534 $1,587.621. in Mississippi $1,736.614.2 in Missouri Billings, MT $1,534 $455 State of Nebraska $1,370 $386 The State of Nevada $1,974 $926 $1,037.384.88 New Hampshire $1,592 $820 in New Jersey Budget: $1,334 ($506) $1,704 $826 in New York A $955 reduction to a $405 budget in North Carolina There was a disparity of $1,379 $417 between North Dakota and Ohio and $1,047 $414 between North Dakota and Oklahoma, which was $1,787 $632. Costing $1,463 and saving $727 in Oregon Money Spent on Gas in Pennsylvania: $1,475 $514 Spending in Rhode Island ($2,103) was lower than expected ($1,002). In the state of South Carolina, $1,414 is required to cover $633 in costs. 1 708$ + 385$ = $2,057 in South Dakota $1,570 in Tennessee and $473 in Texas Utah $1,306 $641 $ 1,156.67 Vermont Money Spent on Housing in Virginia $1,005 $380 Dollars: $1,368.669. To the tune of $1,536 $586 A total of $1,181 $385 in Wisconsin One Thousand Four Hundred Thirty-Nine Dollars and Thirty-Nine Cent
According to Zebra’s data (2020).
Any driver who has ever moved and watched their premiums suddenly skyrocket can attest to the fact that a driver’s risk level is significantly higher in areas with higher crime rates.
Michigan has the highest auto insurance prices in the country, nearly double the national average. In all but ten states, the cost of basic coverage is less than that of full coverage in Michigan.
Average prices for a fully comprehensive auto insurance policy are $935 in Maine, the lowest in any state. With a mean cost of under $304, Iowa is easily the best in the nation for minimal coverage.
What each insurance provider charges on average for vehicle insurance Assurance firm Lowest prices with average protection USAA $885 Geico $1,168 $1,234 for State Farm; $1,267 for Travelers; $1,373 for Progressive. Average American Family Spending $1,391; Farmers Spend $2,082 Insurance: $1,864 statewide; $1,880 with Allstate
U.S. News is the data source (2020).
Clearly, it’s in the driver’s best interest to shop around for the best car insurance prices available. Savings of several hundred dollars or more could be realized by deciding on the best insurance provider.
US Service Automobile Association (USAA) auto insurance coverage has consistently received good evaluations from customers for both quality and affordability. Members of the armed forces (current or former) and their dependents are the only people who can use this service provider.
The Impact of Driving History on Auto Insurance Premiums Disadvantageous Remarks Appear on Driving Record Price of insurance typically goes up Two-and-a-half percent of drivers have been issued tickets for speed Injuries, 43% 75% of drivers who test positive for alcohol have never been convicted of DUI. Seventy-one percent of people have poor credit.
We got our numbers from U.S. News.
Those without spotless driving histories pay significantly more for auto insurance. The cost of insurance goes up significantly after only one infraction, accident, or DUI.
Except for the few areas that have outlawed the practice, insurance companies also utilize credit scores for setting premiums. Insurance premiums are higher for drivers with bad credit since they are statistically more likely to make a claim.
And the staggering part is how much more. A poor credit score can have nearly the same negative effect on a person’s finances as a DUI conviction.
In addition, we have information on the typical rate increases of the most common auto insurers.
Provider with the most affordable prices and standard levels of coverage Violation of the speed limit Accident Drunk driving Substandard credit USAA $885 $1,041 (+17.6%) $1,229 (+38.9%) $1,683 (+90.2%) $1,653 (+86.8%) Geico $1,168 $1,510 (+29.3%) $1,802 (+54.3%) $2,958 (+153.3%) $1,855 (+58.9%) Assurance Company, State of $1,234 $1,375 (+11.4%) $1,487 (+20.5%) $1,681 (+36.2%) $2,745 (+122.4%) Travelers $1,267 $1,721 (+35.8%) $1,842 (+45.4%) $2,430 (+91.8%) $2,095 (+65.4%) Progressive $1,373 $1,803 (+31.3%) $2,324 (+69.3%) $1,793 (+30.6%) $2,308 (+68.1%) U.S. Domestic Unit $1,391 $1,497 (+7.6%) $1,684 (+21.1%) $1,726 (+24.1%) $2,277 (+63.7%) Farmers increased their income by $209 (from $1,682) each year. $2,446 (+45.4%) $2,640 (+57.0%) $2,669 (+58.7%) Nationwide $1,864 $2,263 (+21.4%) $2,766 (+48.4%) $4,011 (+115.2%) $2,549 (+36.7%) Allstate $1,880 $2,212 (+17.7%) $2,673 (+42.2%) $3,252 (+73.0%) $3,025 (+60.9%)
We got our numbers from U.S. News.
Each service provider has its own system for weighing the negative effects of baggage. Rate rises following traffic violations, accidents, or DUIs are significantly more forgiving with State Farm. Drivers with poor credit, meanwhile, face significantly tougher regulations.
The premiums at Geico and Nationwide are lower for drivers with poor credit, but they increase dramatically for those with a DUI.
How many drivers in the United States lack auto insurance?
There have been fewer uninsured drivers on the road in recent years, but many remain.
An Insurance Research Council study found that 13% of motorists were uninsured in 2015. Some states were significantly higher than average, with almost 27% of Florida drivers having no auto insurance.
Uninsured or underinsured motorist coverage provides extra coverage if drivers are in an accident caused by an uninsured motorist or someone who doesn’t have enough insurance coverage.
A regular expense for every driver
While many factors aren’t under drivers’ control, there are several ways for them to get lower auto insurance costs.
They can choose insurance companies that offer lower prices and adjust coverages depending on whether they want more protection or a cheaper plan, for example. They can also work on improving credit to qualify for the best possible rates. Every driver should get multiple auto insurance quotes.
And, of course, drivers control how they drive, which is often the most important factor in the cost of their car insurance policy. The ones who follow the rules of the road and avoid accidents benefit in the long run by scoring cheaper insurance.