Average Car Insurance Cost

Paying too much for car insurance is not a new concept for most drivers, but calculating how much of the monthly premium qualifies as “too much” can be a lot more elusive. The best way to determine how much you could save on car insurance is by comparing your current rate with your area’s average car insurance cost. Freeway Insurance can help you take the hassle out of it and find the coverage you need with ease.

Before you begin your search for more affordable rates, you should know what prices to expect when comparing quotes. Learn how to use the average monthly premiums, along with your location and driving history, to match with the best quotes and save some serious money.

How much is the average cost of car insurance each year? Generally speaking, the average cost is about $1,600. However, this number can only tell drivers so much because different states have their own average car insurance costs, places like Arizona, where car insurance rates can vary based on local factors. Within those states, there can also be cost variation within different cities and even different zip codes.

Also, consider how different drivers opt for varying levels of car insurance coverage.

The first time behind the wheel, most drivers will ask about how much insurance they actually need. And there are two ways to answer that question.

In many ways, full coverage insurance is the opposite of minimal coverage. This type of coverage is reserved for drivers who want maximum protection. Despite this, there is a lot of confusion over what this insurance is and how it can affect your monthly premium.

Part of the confusion comes from the fact that “full coverage” is not its own insurance type. Instead, this term refers to combining liability, collision, and comprehensive coverage.

This is called full coverage because it protects you in many scenarios.

Another thing that makes your monthly insurance premium so difficult to decode is that you don’t always know what is affecting the cost. For example, your credit score can play a surprising role in how much you pay each month.

How much of a difference?

Let’s imagine there are two drivers with similar backgrounds, jobs, cars, age, and marital status. What if one of them has very poor credit and one of them has very good credit? In that case, the driver with poor credit might pay as much as 75% more for the same insurance coverage as the driver with good credit.

This may not seem fair, but you can use it to your advantage. For example, if you work on improving your credit, you can let your insurance carrier know after it has improved. By letting them know about your improved credit or simply shopping for a different insurance carrier at that time, you can lower your monthly premium.

While the impact of credit on your car insurance rate may be surprising, here is something less surprising: Dangerous driving behaviors inevitably lead to increases in your rate.

For example, your insurance will likely go up a little bit anytime you file a claim. But if you were at fault in a car accident, you may see a serious increase. In fact, the average cost of car insurance for those at fault in a car wreck is nearly $850 higher than the national average for car insurance.

Getting charged with a DUI has even harsher penalties, with the average cost of car insurance nearly twice as high as the national average.

In this situation, an ounce of prevention is better than a pound of cure. Try to avoid dangerous driving behaviors to keep your rates as low as possible. If your driving record is less than perfect, consider enrolling in a driving safety course that can ultimately lower your insurance premium.

When it comes to factors that affect the average car insurance cost, there are some factors that you can control, at least partially. This includes things like where you live and what your credit score is.

However, there are certain factors you can’t control. And the most obvious factor is your age.

While it may not seem fair that age impacts car insurance, this works in your favor over time. For example, car insurance is usually at its highest when you are a teenage driver, and the rates may continue to be high until you are about 25.

However, even within the 16-25 age range, you’ll see these rates go down. At age 20, the average driver can expect to pay about $3300 for full coverage. At age 25, that same driver can expect to pay a little under $2800.

Prices generally taper off as you get older, though they will spike up slightly for the very elderly drivers. Speaking of older drivers, if you have recently retired, you should let your insurance company know. The fact that you are no longer commuting to work may lead to a lower insurance premium.

Some vehicles are more costly than others. For example, fast sports cars are more expensive to insure because faster drivers are likelier to cause wrecks. And luxury cars are more expensive to insure because their expensive parts are harder and costlier to replace.

For that same reason, electric vehicles are more expensive to insure. Such vehicles may save you money on gas and be better for the environment, but the batteries and other parts are expensive to replace, resulting in a higher premium.

Finally, while this is rare, there are certain makes and models of cars that are likelier to be stolen. Such vehicles are more expensive to insure via comprehensive insurance.

Looking for ways to drive your insurance premium down? In some cases, you can make positive changes to your credit score and obtain a better rate. In other cases, changing the car you drive or the area you live in can lead to a lower monthly cost.

However, one of the better things you can do to lower your risk is to ask your insurance carrier about any discounts they offer. Every carrier offers special discounts for certain things, and you might not know what these discounts are until you ask.

For example, you can get discounts for a safe driving record or for completing a safe driving course. You can also get discounts for installing anti-theft devices and other safety equipment in your car. If you’re a college student, you may even be able to get a discount for good grades!

While car insurance discounts are great, the best way to save money on your monthly car insurance premium is usually to find a new automobile insurance company.

If you are comparing minimum and full coverage rates by state, it can also help to review options for full coverage car insurance in Illinois based on your budget and driving needs.

It’s easier than ever to compare insurance rates online. And if you have any questions, you can always pick up the phone and call the carrier. With just an hour or two of research, you’ll have all the information you need to find a better price on your car insurance.

If you are comparing insurance costs by state, it can also help to review options for cheap auto insurance in Florida based on your coverage needs and location.