Car Insurance

How to compare car insurance rates

Before you can compare auto insurance quotes, you need to understand some car insurance basics. Car insurance is part of a larger type of insurance called property and casualty, which also includes home insurance, boat insurance and renters insurance, among other types. Insurance is a financial product. Car insurance does not actually protect your car; it protects your finances. Depending on the coverage you purchase, an auto insurance policy is designed to protect you from the financial devastation that could result from being in a car accident. Insurance is also a pool. Everyone pitches in a little money — your premium amount — so that if and when an accident happens, everyone loses a little bit, but no one loses everything. If you are shopping for auto insurance, you have probably heard that you should compare car insurance rates. But what are you looking for? How should you compare different car insurance quotes? And how do you know if you are getting a good deal?

Top car insurance companies

Perhaps the first thing you should do when you are shopping for car insurance is decide what companies to request quotes from. To do this, you will need to decide what factors matter most to you. Are you looking for the best coverage for your needs? Or the cheapest policy possible? By deciding what you want from an insurance company, you may be able to narrow down which companies to approach.

Types of car insurance coverage

An auto insurance policy is a package of several coverages. The types and amounts of coverage you choose will depend on your specific situation. Some common coverages are:

• Bodily injury liability: This is designed to cover the cost of injuries that you cause to another party in an accident.
• Property damage liability: This pays for the damage that you cause to someone else’s property in an at-fault accident, like damage to another car, a building or personal property.
• Uninsured motorist and underinsured motorist coverage: These coverages can pay for your damages and injuries if you are hit by a motorist who does not have any insurance or does not have enough insurance to cover your expenses.
• Collision: This covers the damages to your car caused by colliding with another vehicle or object.
• Comprehensive: Often called “other-than-collision” coverage, this pays for damages to your car caused by a variety of scenarios, including theft, vandalism, storm damage, weather damage and hitting an animal. Adding comprehensive and collision to your policy means you are purchasing “full coverage.”
• Medical payments coverage: This pays for your and your passengers’ medical bills stemming from an accident, regardless of fault. Depending on where you live, it may be mandatory, optional or not available.
• Personal injury protection (PIP): This coverage is similar to medical payments, but also covers lost wages and the cost to hire someone to do household tasks if you or a passenger is unable to complete them. It is often required in no-fault states, may be optional, or, like medical payments, may not be available depending on where you live.
• Gap insurance: If you have a loan or lease on your vehicle, this coverage pays the difference between your loan amount and the depreciated value of your car if it is totaled.

When comparing car insurance quotes, you will likely want to make sure that you have requested the same types and amounts of coverage from each company. That way, you can more easily see which company can offer a lower premium for the coverage you need.

Factors that affect car insurance rates

Your car insurance premium is not just based on which company you choose. There are numerous other factors that can impact how much you pay for auto insurance, including:

• Age: Your age has a large impact on your car insurance premium, with teens paying the most. This is why it can be beneficial for parents to insure teenagers, rather than having your teen get their own policy. As you age into your 20s and 30s, car insurance rates begin to drop. However, rates may slightly increase again after around 70-years-old. Some states do not allow age to be used as a rating factor.
• Gender: Males tend to pay higher rates than females, due to an increased likelihood of getting into more accidents and more severe accidents.
• Vehicle type: The vehicle you drive is another big factor when it comes to how much you will pay. Some vehicles are cheaper to insure than others.
• Credit rating: It may be surprising, but your credit score can impact your car insurance premium. Drivers with low credit scores tend to find more claims than drivers with higher scores, and so insurance companies charge higher premiums to compensate for the increased risk. Not all states allow credit to be used as a factor in determining your rate.
• Driving record: If you have accidents, tickets or DUI convictions on your record, you will likely pay more for insurance.
• Insurance history: Drivers with continuous insurance tend to pay less than drivers with lapses in coverage or no insurance history.
• Coverages: The coverage and levels of coverage that you choose will raise or lower your premium. Generally, higher levels and more optional coverages will cost more.
• Discounts: If you qualify for one or more car insurance discounts, you may be able to lower your premium.

You may also save money on car insurance if you are married. And if you are a member of the military or a veteran, you could find specialized discounts or coverage options that are less expensive.

Car insurance rates by state

In addition to the factors listed above, the state you live in has one of the biggest impacts on your car insurance premium. Your state’s minimum coverage laws, the likelihood of getting into an accident, the average severity of accidents and the percentage of uninsured motorists can all impact the average car insurance cost in your state.

State	Car insurance company	Average annual full coverage premium
Alabama	Travelers	$1,071
Alaska	USAA	$1,069
Arizona	Geico	$916
Arkansas	USAA	$1,142
California	Geico	$1,615
Colorado	Geico	$1,106
Connecticut	Geico	$1,071
Delaware	USAA	$955
Florida	State Farm	$1,739
Georgia	Nationwide	$1,202
Hawaii	USAA	$1,009
Idaho	USAA	$725
Illinois	Geico	$928
Indiana	State Farm	$913
Iowa	USAA	$1,026
Kansas	USAA	$1,225
Kentucky	USAA	$1,466
Louisiana	Southern Farm Bureau	$1,871
Maine	Geico	$578
Maryland	Nationwide	$1,232
Massachusetts	Safety	$827
Michigan	USAA	$1,255
Minnesota	State Farm	$1,167
Mississippi	USAA	$1,109
Missouri	USAA	$988
Montana	USAA	$931
Nebraska	Farmers	$1,282
Nevada	Geico	$1,116
New Hampshire	USAA	$681
New Jersey	State Farm	$1,244
New Mexico	USAA	$1,102
New York	Main Street America	$761
North Carolina	Geico	$835
North Dakota	USAA	$815
Ohio	USAA	$820
Oklahoma	Geico	$1,066
Oregon	Travelers	$1,017
Pennsylvania	Geico	$916
Rhode Island	USAA	$1,297
South Carolina	American National	$505
South Dakota	State Farm	$1,242
Tennessee	Geico	$992
Texas	Geico	$1,339
Utah	USAA	$839
Vermont	USAA	$807
Virginia	USAA	$890
Washington	USAA	$818
Washington, D.C.	USAA	$876
West Virginia	Nationwide	$993
Wisconsin	State Farm	$785
Wyoming	State Farm	$1,234

Car insurance rates by age

In most states, your age plays a significant role in how much your car insurance costs. Younger drivers tend to be viewed as higher risk by insurance companies, with a greater likelihood for causing accidents, than older drivers. If you can manage to keep a clean driving record, your car insurance premiums will generally decrease in your early 20s, although they can begin to creep up again in your senior years.

*16- and 17-year-old premium when added to their parents’ policy

Car insurance rates by driving history

Your driving history will also affect how much you pay for insurance. Tickets and accidents can increase your premium for three to five years and sometimes longer. And with distracted driving on the rise, the likelihood of getting into an accident may also be increasing. Below are the five largest car insurance companies in the country, by market share, and their average full coverage premiums before and after an accident.    

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2021 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:

• $100,000 bodily injury liability per person
• $300,000 bodily injury liability per accident
• $50,000 property damage liability per accident
• $100,000 uninsured motorist bodily injury per person
• $300,000 uninsured motorist bodily injury per accident
• $500 collision deductible
• $500 comprehensive deductible

To determine minimum coverage limits, Bankrate used minimum coverages that meet each state’s requirements. Our base profile drivers own a 2019 Toyota Camry, commute five days a week and drive 12,000 miles annually. These are sample rates and should only be used for comparative purposes.

Incident: Rates were calculated by evaluating our base profile with the following incidents applied: clean record (base), at-fault accident, single speeding ticket, single DUI conviction and lapse in coverage.

Age: Rates were calculated by evaluating our base profile with the ages 18-60 (base: 40 years) applied. Depending on age, drivers may be a renter or homeowner.