How Much is Car Insurance?
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Answering the question, "How much does car insurance cost?" can be tricky.
Everyone wants to find the right amount of coverage for the cheapest price. However, giving a general but accurate price for car insurance is impossible because a variety of factors unique to each driver determine the number.
These factors include:
- Location
- Driver's age and gender
- Driver's history
- Credit score
- Type of car
However, there are ways to make sure you get the best converge at the lowest price.
Factors That Influence Car Insurance Prices
Determining a car insurance price isn’t a cut-and-dry process. Answering "How much is car insurance per month?" depends on multiple factors. Some of these are factors you can control, and some aren't.
Location
Where you live impacts the overall price of your auto insurance. Before an insurance company offers you a quote, it will consider how likely someone living in your area is to file a claim due to an accident, vandalism, or theft.
Harsh weather, such as hail storms and tornados, a high percentage of uninsured drivers, or drunk driving accidents are other factors that can cause insurance companies to raise premiums based on your location.
Driver’s Age and Gender
Carriers take a driver’s experience into account when providing rates, which means younger drivers pay more. Drivers between the ages of 16 and 25 pay higher rates than drivers over 25.
Full car insurance usually includes liability, collision, and comprehensive insurance, including coverage for uninsured or underinsured motorists, personal injury protection, and medical payments.
It's important to note that all premium costs will vary by carrier. But as an example of how age and gender can affect a policy's rates:
- Progressive's rates drop by an average of 9% for drivers when they turn 25.
- Their rates for drivers under 17 start at $206 per month.
- Drivers who are 18 pay more than their younger counterparts — an average of $230 per month.
- Rates then begin to drop with an average monthly premium of $203 for 19- to 20-year-olds, $176 for 21- and 22-year-olds, $153 for 23- and 24-year-olds, and finally dropping to $136 for drivers aged 25 to 29.
Gender can also play a role in auto insurance rates. Women often pay less than men on average. Statistics show that women are less likely to have serious accidents and have fewer accidents from driving under the influence, leading providers to reduce their rates.
Driver’s History
Your driving history is a significant factor in determining your car insurance rates. Carriers consider drivers with no or few accidents or violations to have a good driving record. Good drivers are low-risk, and insurance companies usually reward them with lower monthly premiums.
Drivers with multiple accidents or traffic violations on their record are more likely to file claims in the future, resulting in payouts from the insurance company. Because poor drivers are high-risk, insurance companies will raise their monthly premiums.
Credit Score
Many carriers consider a driver’s credit score when determining an auto insurance quote. However, in Massachusetts, Hawaii, and California, it is illegal for insurance companies to consider credit scores when calculating rates.
Factors such as your payment history, types of credit, length of credit history, and amount owed all determine your credit score. Scores range from 300 to 850, with higher scores being better. Insurance companies may reward drivers with higher credit scores with better rates.
Type of Car
Auto insurance providers will consider the make and model of your vehicle before issuing you a quote. They do this because the overall cost of a car plays a significant role in insuring it.
The type of car may also influence the likelihood of theft or the cost of repairs and maintenance. Your vehicle's safety record also impacts insurance rates, and driving a car with safe equipment, such as antilock breaks, may result in discounts.
Coverage and Discounts
The type of coverage you select is a significant factor in the monthly cost of car insurance premiums. Apart from New Hampshire, each state has a minimum amount of coverage individuals must purchase to drive legally. Purchasing the state minimum can reduce your insurance premiums, but you may need more coverage if you get into an accident.
You may be wondering, "When do car insurance rates go down? "The answer is "through discounts." Different carriers offer different types of discounts.
Some standard discounts include:
- Safe driver discount: A reward that reduces your rates based on how long you’ve driven without an accident or violation
- Student discount: A discount for high school or college students who achieve a certain grade point average
- Military discount: A discount for current or former military members
- Automatic payment discount: Drivers who set up automatic payments may be eligible for reduced rates
- Multi-car discount: Insuring multiple cars with the same company can equate to paying less
- Paperless discount: Opting to receive documents and billing electronically instead of paper statements can result in a small discount
While you may be eligible for multiple discounts, providers often limit the total number of discounts you can add to your policy.
Bundling Policies
In insurance, bundling refers to joining multiple insurance policies under one provider. This typically applies to combining your home and auto insurance policies.
Bundling policies together can result in fewer complications in terms of policy management and payments. It also may mean lower rates, as bundling is considered a form of customer loyalty.
While bundling can offer convenience, it can also mean missing out on lower prices from other providers. Switching to a different carrier may result in lower auto insurance rates and better coverage regardless of any discounts.
The Cost of Car Insurance
When asking, "Why did my car insurance cost change?" remember, this cost is never stagnant.
Many factors, including economic conditions, market competition, and technological advances, influence the overall rates of the auto insurance industry. In recent years, car insurance prices have increased, and 2024 has been no exception.
As of May 2024, the average cost of car insurance was $172 per month. However, car insurance rates change frequently.
According to the U.S. Bureau of Labor Statistics, car insurance prices increased by over 22% from April 2023 to April 2024. In just 2024 alone, rates have jumped up 5.66% from January to April.
Most car insurance policies renew every six to 12 months. Your rates will likely adjust to meet the most recent car insurance costs. If you get into an accident or file a claim, your provider may also change your rate mid-policy.
See how much car insurance costs in your state:
How To Get the Best Rates
Determining how much your car insurance premiums will be and which provider is best can be challenging. With so many factors and information to consider, many find it overwhelming. To find the best auto insurance rates for you, it’s helpful to connect with experts directly.
At EverQuote, we offer a flexible way of connecting with agents and carriers over the phone or online, depending on your personal preference. EverQuote can help you determine what coverage you need, the best providers for your situation, and how to get the best price on premiums.
If you want to reduce your auto insurance expenses, switching insurance companies is one of the fastest and most effective ways. Use our tool today to see how much you can save by hitting continue!
Frequently Asked Questions
Is $500 a lot for car insurance?
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How expensive can car insurance get?
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Why did car insurance go up in 2024?
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Premiums are sourced from over 30,000 zip codes across 200 insurance companies. We estimate premiums based on public filings for policies seeking 50/100 in liability with $500 deductibles for collision and comprehensive coverage. Estimated rates are based on a 35-year-old single female with a good credit score and no history of accidents or violations driving a 2023 Toyota RAV4 LE. We partner with Quadrant Information Services to source our data and assume no unique benefits or discounts are applied for these rates (unless otherwise stated). Your own rates may be different.