Car insurance isn’t cheap, but most states do require drivers to carry a minimum amount of coverage. In the United States, the average cost of minimum coverage car insurance is $563 per year and full coverage car insurance is $1,738 per year. However, the cost varies significantly based on location and personal factors, like your age and credit score.
If you’re shopping around for car insurance, it helps to know how much you can expect to pay based on where you live. And even if you live in a state with higher-than-average rates, there are ways that you can lower your premium.
Average car insurance cost by state
The average annual premium varies by location. Different states have different rates, and even your zip code can influence your costs. Premiums are affected by local factors including the amount of traffic and accidents in the area and crime rate.
Below is the average cost for car insurance in each state.
|State||Full Coverage Premium||Minimum Coverage Premium|
|District of Columbia||$1,810||$638|
Average car insurance cost by company
The cost of car insurance varies from carrier to carrier. Although some providers are known for offering cheaper rates, their levels of coverage may also be less than other providers who offer more expensive rates on average.
To find the best car insurance company, get quotes from different providers to compare rates and features.
|Insurance Provider||Full Coverage Premium||Minimum Coverage Premium|
When deciding the amount of coverage you want, you can opt for liability coverage that meets your state’s minimum standards, or you can select full, comprehensive coverage.
Liability coverage pays for all damages you cause to others but does not cover damages to you or your vehicle caused by others. Comprehensive or full coverage includes paying for the damages you cause to others, as well as damages to you or your car.
The laws surrounding auto insurance change quite a bit from state to state, so check local legislation when shopping for car insurance.
Additional factors that determine your rate
Your car insurance coverage options have a significant effect on your rate. However, it’s important to consider the other factors that can impact the cost of your annual premium. Car insurance providers look at a variety of different factors related to your car’s value and the likelihood of you being involved in an accident. Some of these factors include:
- Geographic location: The area you live in plays a significant role in determining the price of your car insurance. Living in certain cities and even neighborhoods can impact the cost of coverage significantly. For example, in New York, Brooklyn neighborhoods see the highest average premiums because of their high population density, increased risk of car break-ins and theft and a higher number of commuters. Meanwhile, Manhattan drivers pay less because more people in the borough use public transportation to get around.
- Type of car: The type of car you drive can impact the cost of your car insurance policy because it’s based, in part, on the value of your car. If you have a brand new, expensive sports car, it will cost more to replace or repair it, so your premium will likely cost more. On the other hand, if you have an older car, you may pay less. The premium can also vary based on the vehicle’s safety, theft ratings, and mileage.
- Driving history: One of the easiest ways to see your car insurance premium skyrocket is by getting into car accidents or accumulating traffic tickets. These incidents indicate to your insurance carrier that you are a higher-risk driver.
- Credit score: The statistics show that drivers with poor credit file more claims, and more expensive claims, than drivers with good credit.
- Age: Age is a particularly important factor in determining your car insurance premium, especially if you’re a young driver. Data shows that teenage drivers are more reckless and become involved in more accidents than any other age group. Therefore, young drivers face much higher premiums when compared to older drivers.
- Gender: Though only relevant for those drivers under the age of 25, gender can play a role in how much you pay for car insurance. Male drivers 24 and younger pay an average of $10 less per year for their car insurance than their female counterparts.
How to save money on car insurance
Most car insurance carriers provide discounts that can lower the cost of your insurance premium. The exact discounts vary among insurance providers, but there are a handful of savings that are standard. When you buy an insurance policy, make sure to ask an agent about all the discounts you qualify for. Here are some of the most common insurance discounts:
- Safe driver discounts: Most car insurance providers offer safe driver discounts for drivers who have completed an eligible safety course within the past couple of years.
- Claims-free: Drivers who have no claims on their record from the past several years usually qualify for savings.
- Multi-car discounts: If your household has multiple vehicles, consider placing them all on one insurance policy to qualify for multi-car discounts.
- Bundling insurance policies: You can often score better insurance premiums overall when you bundle your car insurance policy with a life or home insurance policy.
- Good student discounts: Many insurance carriers offer discounts for young drivers with good grades in school. For example, Nationwide extends its good student discount to those drivers aged 16-24 enrolled full-time in high school or college who sustain a B average. You’ll need to provide academic evidence in the form of an up-to-date grade report or a form signed by a school administrator.
- Paying in full: If you can afford to pay your annual car insurance premium in full, you’ll likely save money. Many insurance companies provide a discount for those drivers willing to pay upfront because it is more convenient and requires less processing for them.
- Safety features: If your car has common safety features, like airbags, an anti-theft device, or anti-lock brakes, some insurance companies will deduct money from your rate.
Frequently asked questions
What discounts are available for car insurance?
There are a lot of discounts available for car insurance. Some examples are taking a safe driving course, bundling your insurance policies, having an anti-theft device in your car and paying your premium in full. Ask your carrier about the insurance discounts they offer to see how you can qualify.
Is full-coverage liability worth it?
Full-coverage liability is worth it, especially if you drive often, have a car loan, or if your car is worth a lot of money. The only time it’s worth buying the minimum amount of coverage is if the car is paid off in full and its current value is not worth the annual premium.
How can I find the best rate for my car insurance premium?
To find the best rate for car insurance, shop around for personalized quotes from different auto insurance providers. By comparing quotes from different providers, you’ll be able to choose the cheapest policy for the amount of coverage you need.
Bankrate utilizes Quadrant Information Services to analyze 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 cleaning 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 sample drivers own a 2018 Honda Accord, commute five days a week and drive 12,000 miles annually.
These are sample rates and should be used for comparative purposes only. Your quotes may be different.