Average Cost of Car Insurance by State, Company, Car, and More

While car insurance rates vary on an individual level, understanding what average rates look like can help you plan your insurance budget. The national average for liability-only car insurance is approximately $183 per year, while full-coverage car insurance averages around $372 per year, according to Compare.com data.

Several factors can influence the cost of car insurance, including your age, driving history, location, vehicle, coverage limits, deductibles, and credit score. To help you gain a better understanding of how the average cost of car insurance can vary, let’s take a look at average rates by state, company, and other factors.

Key Takeaways

• Drivers older than 25 generally pay less for car insurance.
• Vermont, Iowa, and North Carolina have the cheapest rates of any state.
• You can save money by paying your annual premiums in full (along with other discounts).

Average Car Insurance Cost by State

As we already mentioned, the average national rate for full-coverage car insurance is $372 per month, but drivers can expect to pay about half that ($183) if they choose a liability-only policy. That said, it’s important to remember these are just averages, and your unique driver profile determines the rate you’ll actually pay.

For example, where you live can affect how much you spend on car insurance. Location is a key factor that affects auto insurance rates due to varying levels of risk associated with different geographic areas. Insurance companies consider factors such as traffic congestion, accident rates, crime rates, and the frequency of severe weather events when determining premiums. State regulations and legal requirements can also play a role in your overall rates.

Check out the table below for more context on how your state affects car insurance rates. Here, you’ll find the average monthly cost of both liability-only and full-coverage car insurance in each state.

As you can see, rates vary dramatically from state to state. Some states — such as New York, New Jersey, and Michigan — have average rates that nearly reach $500 for full coverage. Others — like the ones outlined in the following section — can be as little as a quarter of that price.

States with the cheapest average car insurance costs

Vermont, Iowa, and North Carolina have the cheapest overall average car insurance costs. Let’s look at why this may be.

1. Vermont

• Liability only: $48 per month
• Full coverage: $130 per month

Vermont’s relatively low population density likely leads to lower traffic congestion, which can contribute to lower insurance costs. Additionally, the state’s lower vehicle theft rates help keep premiums affordable.

2. Iowa

• Liability only: $52 per month
• Full coverage: $155 per month

Iowa’s rural nature and lower accident rate compared to more densely populated areas contribute to more affordable insurance rates.

3. North Carolina

• Liability only: $78 per month
• Full coverage: $184 per month

North Carolina’s low population density and mild weather can both contribute to affordable premiums from insurance companies.

On the flip side, Michigan, Florida, and New Jersey are some of the most expensive states for car insurance, on average.

Average Car Insurance Costs by Company

The car insurance company you choose can significantly impact your car insurance rates since each company has its own pricing models, risk assessments, and coverage options. Insurance companies may also offer discounts or incentives based on various factors, like safe driving records or policy bundling.

The following table shows the average monthly cost of liability-only and full-coverage car insurance for 10 of the largest insurance companies in America:

Auto-Owners offers the cheapest average rates for liability-only policies, at $55 per month, while State Farm has the cheapest monthly full-coverage rates, at $139.

On the other hand, Farmers skews the most expensive compared to other large insurance companies, with average rates of $151 per month for liability and $295 for full coverage.

It’s important to note that actual rates can vary based on your individual circumstances and coverage needs, so it’s worthwhile to compare auto insurance quotes from multiple companies. That way, you’ll find the best coverage at the most affordable price.

Car Insurance Costs by Driver Profile

Certain factors — such as age, gender, and credit score — affect car insurance rates because they often correlate to varying degrees of risk.

Young drivers — particularly those below age 25 — are statistically more prone to accidents and risky driving behaviors. As a result, insurance companies generally charge higher premiums for this age group.

Gender plays a role as well, with women statistically having fewer accidents and DUIs, as well as less serious accidents than men. Because of this, women often pay less for auto insurance, all other factors being equal.

Your credit score — more specifically, your credit-based insurance score — is a statistical tool insurance companies use to predict the likelihood of filing a claim and the associated cost. Drivers with higher credit scores are seen as more financially responsible and less risky to insure. While controversial, credit scores are used in many states to determine insurance rates — but four states have banned the practice entirely, and others have limited its use in determining rates.

These factors — along with others, such as driving record and location — help insurance companies assess risk and set appropriate premiums.

Average car insurance costs by age

Age plays a big role in how much you pay for car insurance since it typically directly correlates to your experience on the road. Younger and inexperienced drivers are statistically more likely to be involved in accidents, which leads to more expensive insurance premiums. But as drivers mature and gain more experience, insurance rates generally decrease.

Additionally, older drivers may experience increased rates due to age-related declines in vision, reaction time, and overall driving abilities.

The following table highlights the average monthly costs of liability-only and full-coverage car insurance based on different age groups:

As we mentioned, teen drivers have some of the most expensive car insurance rates of any demographic. The average 18-year-old spends nearly $350 per month for basic liability coverage and almost $700 for full coverage. Luckily, those rates drop by more than half once drivers turn 25.

On the other hand, 40-year-old drivers have the cheapest rates of any age group, with liability rates coming in at $122 per month and full coverage costing just over $250.

The cost of car insurance by marital status

Married drivers often enjoy a discount on car insurance policies, which can be a nice post-wedding present. The catch? They need to combine their separate policies into a single policy under one car insurance company.

The following table shows the average monthly cost of liability-only and full-coverage car insurance for single vs. married drivers:

The difference between single and married drivers may not be as significant as some other factors, but it’s still nothing to scoff at. You can expect your auto insurance rates to drop by around 5% after getting married, regardless of coverage type.

Average car insurance costs by credit score

Your credit score can play a significant role in your car insurance rates since it’s seen as a measure of your overall financial responsibility. Insurance companies believe that drivers with higher credit scores are more likely to make timely payments and practice safe driving habits. On the other hand, drivers with lower credit scores may face higher insurance rates.

But it’s important to note that not all states permit the use of credit scores when setting auto insurance rates. Regulations and practices surrounding the use of credit scores in insurance vary by state.

The following table shows the average monthly cost of liability-only and full-coverage car insurance for drivers with credit scores ranging from “excellent” all the way to “poor.”

Each credit score level sees a significant rate increase as overall scores drop. It should be no surprise that drivers with “excellent” credit scores get the best rates, but those rates increase by nearly 20% if your score drops even to “good.”

The difference between drivers with “excellent” credit scores and those with “poor” scores can be as much as 150%. So, there are obviously huge advantages to increasing your credit score, even when it comes to car insurance.

Average Car Insurance Costs by Driving Record

Blemishes such as speeding tickets, DUI convictions, at-fault accidents, and other moving violations can dramatically affect your car insurance rates. After all, the more collisions or moving violations on your record, the more likely you are to file a claim with your auto insurance company.

Drivers with a clean driving record typically see the lowest rates of any group, while those with accidents or serious violations typically pay much more.

On the other hand, new drivers without an insurance track record may also face higher initial rates.

Average car insurance costs with a DUI

A DUI conviction can greatly affect your car insurance rates. Insurance companies consider DUIs to be one of the strongest indicators of high-risk driving behavior. As a result, drivers with a DUI on their record typically face substantial increases in their insurance premiums at their next policy renewal.

The table below showcases how much you can expect insurance rates to increase after a DUI:

As you can see, the average DUI offense can lead to your rates doubling overnight. The average liability policy increases more than 100% after a single DUI conviction, while full-coverage policies experience a 92% increase, on average.

Average car insurance costs with a speeding ticket

A simple speeding ticket can also affect your car insurance rates since insurance companies view speeding as a sign of potentially unsafe driving habits and a higher likelihood of accidents. As a result, drivers with speeding tickets on their record often face higher insurance premiums.

The following table shows the average monthly car insurance costs for drivers with a speeding ticket compared to those with a clean record:

Even a single speeding ticket can increase auto insurance rates by around 25%, regardless of coverage type. That’s why the easiest way to save on car insurance is to simply practice safe driving.

Average car insurance costs with an at-fault accident

Similar to speeding tickets and DUIs, having an at-fault accident on your record gives car insurance companies cause for concern that you participate in unsafe driving and are more likely to file claims.

The table below highlights the average monthly car insurance quotes for drivers with an at-fault accident compared to those with a clean record:

As you can see, a single at-fault accident has an even larger effect than speeding tickets and other moving violations. Causing a collision increases the average liability policy by more than 50%. Full-coverage policies experience a less drastic increase, but you can still expect your collision and comprehensive coverage rates to jump by around 43%.

Why Car Insurance Costs Are Rising

Car insurance costs have increased significantly since the start of the pandemic. Lockdowns during the early part of the pandemic — as well as the subsequent shift to remote working — initially led to rates dropping since there were fewer drivers on the road and, therefore, fewer accidents and claims.

However, as driving patterns returned to normal, rates started to rise to unprecedented levels as factors like inflation, supply chain shortages, rising new and used car prices, and increased repair costs hit insurance companies hard.

“There are several macro factors generating the rising cost of car insurance across the U.S. One of the primary reasons is the increase in accident frequency and severity since the pandemic began,” Mark Friedlander, director of corporate communications at the Insurance Information Institute explains. “As a result, insurers’ costs are at record levels, and premiums are not keeping up with the amount of claims being paid out. That’s why some companies are raising rates.”

Friedlander notes that other key factors are behind higher insurance rates across the U.S., including:

• The number of deaths and injuries on the road has increased, resulting in greater reliance on attorneys to settle claims.
• Ongoing problems in the supply chain have caused prices to rise for new vehicles, replacement parts, and labor required for vehicle repairs.
• Advanced vehicle technology and enhanced safety features have made auto repairs more expensive.

To better visualize how car insurance rates have increased in recent years, the below table shows the average national cost of car insurance over the past four years:

After rates stabilized through the first two years of the pandemic, things spiked in 2022 — jumping once more in 2023. Since the start of the pandemic, the average auto insurance premium has jumped a whopping 28%, and rates are only going to continue to rise in the coming months.

So, if you’ve yet to receive a rate increase from your insurance company, it’s worth preparing for a jump once your current policy renews.

Other Factors That Affect Car Insurance Costs

In addition to age, gender, credit score, and driving record, several other factors can influence your car insurance rates. A significant one is the car you drive.

Insurance companies consider various aspects of your vehicle when determining premiums. Your car’s cost is a crucial piece of that. Expensive cars typically have higher insurance rates since they cost more to repair or replace.

Additionally, factors like your vehicle’s theft rates, repair costs, engine size, and overall safety record play a role. Vehicles equipped with advanced safety features and high-quality safety equipment may qualify you for discounts.

The following table showcases the average monthly auto insurance costs for different vehicle makes, models, and body types. The table shows a variety of vehicles, ranging from common affordable cars, like the Corolla, to trucks (F-150), luxury cars (Mercedes-Benz S-Class), and electric vehicles (Tesla Model 3).

These different vehicle types have varying insurance costs based on several factors, including their MSRPs, repair costs, safety features, and other risk factors associated with each model and vehicle type. For example, the Mercedes-Benz S-Class and Tesla Model X have much higher rates than a standard Corolla because they cost insurers significantly more to repair or replace.

How to Find the Cheapest Car Insurance

If you want cheaper car insurance, check out these expert tips for lowering your monthly premium:

• Consider liability-only coverage: Choosing liability-only coverage can be more affordable since it covers damages to others but not your own vehicle. But this may only be an option if you don’t have a loan or lease on your vehicle and can afford to repair or replace it out of pocket.
• Increase your deductible: Opting for a higher deductible means you’ll pay more out of pocket in the event of a claim, but it can lower your premium since you assume more of the financial risk.
• Take advantage of discounts: Insurance companies offer tons of discounts — such as safe driver discounts, good student discounts, multi-policy discounts, and more. Contact your insurance company or agent about available discounts and see if you qualify for additional savings.
• Bundle car insurance with home or renters: Many insurance companies offer discounts when you bundle multiple policies, such as combining your car insurance with home or renters insurance. This can lead to significant savings.
• Comparison shop: The easiest way to save is to get quotes from multiple insurance companies so that you can easily compare rates and coverage options. Quote-comparison websites — such as Compare.com — allow you to compare quotes from several companies all in one place.

Average Car Insurance Costs FAQs

Before you start researching the best car insurance policies and companies for your needs, let’s take a look at some frequently asked questions about car insurance to better equip you.

How much does car insurance cost?

Car insurance costs vary significantly depending on factors like your age, driving record, location, vehicle, coverage options, and insurance provider. On average, full-coverage car insurance in the United States costs $372 per month, and liability-only policies cost $183. It’s a good idea to obtain quotes from multiple insurance companies if you want an accurate estimate of your specific potential costs.

At what age do you pay the least for car insurance?

In general, car insurance premiums tend to be lower for drivers after they turn 25. This age group is considered less risky by insurance providers, as they typically have more driving experience and a lower likelihood of accidents.

How much does rideshare insurance cost?

Rideshare insurance costs vary depending on several factors, including your location, driving record, the level of coverage you choose, and the insurance company you select. Rideshare insurance typically has an additional cost on top of your insurance premiums. These range between $148 to $422 per month.

Is it better to pay car insurance premiums monthly or annually?

It depends on your personal financial situation and preferences. Paying premiums up front can earn you a discount from many insurance companies. It also eliminates the hassle of monthly payments and potential fees associated with monthly installments.

However, paying premiums on a monthly basis may be a suitable option if you prefer more flexibility in your budget or find it easier to manage monthly payments, even if it may come with slightly higher overall costs.

Methodology

Data scientists at Compare.com analyzed more than 50 million real-time auto insurance rates from more than 75 partner insurance providers in order to compile the quotes and statistics seen in this article. Compare.com’s auto insurance data includes coverage analysis and details on drivers’ vehicles, driving records, insurance histories, and demographic information.

All the quotes listed in this article have been gathered from a combination of real Compare.com quotes and external insurance rate data gathered in collaboration with Quadrant Information Services. Compare.com uses these observations to provide drivers with insight into how auto insurance companies determine their premiums.

Sources:

1. Insurance Information Institute, “What determines the price of an auto insurance policy?,” Accessed June 19, 2023.
2. Insurance Information Institute, “Facts + Statistics: Alcohol-impaired driving,” Accessed June 19, 2023.
3. United States Census Bureau, “U.S. and World Population Clock,” Accessed June 19, 2023.
4. Statista, “Leading states in the U.S. with the least number of motor vehicle thefts in 2020,” Accessed June 19, 2023.