Car Insurance Cost

How much does car insurance cost? The price of car insurance depends on many factors, including your age and experience as a driver, your credit record, and whether you are married and own a home. However, you can still get an idea of the average car insurance rates you can expect to pay.

To get a free auto insurance quote, simply find an independent agent in our network. Your agent can help you get accurate, no-obligation quotes and find any discounts for which you may qualify. 

Factors that Impact Typical Auto Insurance Rates

Monthly auto insurance premiums can range from less than $50 to hundreds of dollars. The average car insurance payment you might expect to pay will be based on your age, where you live, your driving history, the kind of car you drive, the number of cars and drivers in your household, and more.

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Regional Differences in Car Insurance Estimates

Different regions can have very different average auto rates. Insurance companies have higher premiums in states and regions that have more risks, for example. The regional factors that impact typical auto insurance rates include:

1. Location, location, location: Where you live, drive, and work all influence auto insurance rates. If you live or work in an area with high rates of accidents or crime, the odds are greater that you will be in a wreck or be the victim of vandalism or theft. Auto insurance companies may also take into consideration the cost of medical treatment in the areas where you spend most of your time. For a variety of reasons, car insurance rates can vary widely by state and even by ZIP code.
2. The roads most traveled: The roadways you use to get to and from home are also important factors in your auto insurance rates. The regional statistics on traffic accidents in your area, as well as whether you drive in an urban or rural zone may impact your auto insurance premiums.
3. Climate and natural disasters: In regions where there are increased natural hazards, such as blizzards and hurricanes, there is a greater risk of damage to your property. There are also more dangers when you are driving — in some states, icy roads or strong snowstorms create slick highways. Although you can practice being a safe driver in these conditions, other drivers on the road may not be so cautious.

Minimum Auto Liability Insurance by State

If you have just started investigating car insurance rates, you may be wondering if the minimum liability required in your state is enough. The answer is typically no — the state minimum liability will often not be sufficient to cover losses and potential liability claims.

Your next question may be, “What happens if my insurance is not enough to cover a loss?” And the answer to that question is that it must typically come out of your pocket.

The minimum coverage car insurance requirements are provided below, by state. The first number indicates bodily injury liability per person, the second is the bodily injury liability limit per accident, and the third number is the total coverage amount for property damage, in thousands.

Let’s look at Indiana as an example. If you are responsible for an accident in Indiana that destroys a car and sends three people to the hospital, your available insurance will cover the first two people who file a claim, up to a total of $25,000 in medical payments and liability costs, and up to $10,000 in property damage costs. 

Those totals will very likely fall short of the medical payments, legal defense fees, and property damage costs associated with the accident.

How Uninsured and Underinsured Drivers Impact Car Insurance Prices

Motorists with little or no auto insurance are a leading cause of increased premiums. Although minimum liability insurance is required in each state, some drivers buy the insurance only to meet the requirement and then cancel or default on the policy. 

Areas that have a higher rate of uninsured and underinsured drivers typically have higher rates.

In a car accident, the driver responsible must pay for the damage. For example, if a driver rear-ends you at an intersection, that driver must cover the costs of damage and any injuries. If the driver has liability insurance, the driver’s insurance company pays for the damage.

If the driver responsible for causing the accident does not have insurance, or it is a “hit and run” situation, your insurance company pays for your medical treatment and the repairs to your vehicle, with some dependence on whether and how much uninsured/underinsured motorist insurance you carry. 

Since your insurance company is more likely to pay unnecessary costs in areas where motorists tend to go uninsured, the monthly auto insurance premium in these areas is typically higher.

Car Insurance Rates by Age and Experience

Age equals experience in the eyes of insurers. Younger motorists are considered a high-risk demographic. According to the Centers for Disease Control, drivers between the ages of 15 and 19 are four times more likely to crash. Sadly, fatal accidents account for one-third of all teenage deaths.

While these statistics can have a dramatic effect on how insurance companies determine rates by age of the driver, there are a number of measures teen drivers can take to reduce their cost of car insurance.

Car Insurance Cost Reduction Tips for Teens

• Get your license as early as possible, even if you won’t be driving yet
• Maintain an excellent driving record
• Maintain good grades in school

The more time that passes from the day your license was issued, the better for your monthly auto insurance costs. Even if you do not plan to drive alone until you are out of the high risk zone, it is a good idea to get your license as soon as you can to get distance from that “just licensed” period.

How Experience and Driving Record Impact Car Insurance Cost

When estimating your car insurance, a provider will look into your history as a motorist. If you have a history of traffic accidents and citations, your rate will be higher. Insurance companies view drivers with more traffic violations as statistically more likely to be in an accident.

Maintaining a violation-free driving record can dramatically enhance your driver profile and result in lower auto insurance premiums. The time frame to remain free of violations will vary by insurance company, but is typically three to five years.

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Different Insurance Rates for Different Cars

The type of car you drive is a key factor in your estimated car insurance rate. There will be a significant difference in your car insurance rates between a muscle car with a lot of horsepower or a low-profile car that is cheap to repair and rarely stolen. 

And compared to a used minivan, a new Italian sports car will need more expensive repairs in the event of an accident.

Theft is a big factor in insurance rates as well. Each year the National Insurance Crime Bureau looks at auto theft reports from across the country to determine the most frequently stolen vehicles. 

The results are published in an annual report, which providers take into consideration when they create car insurance estimates.

To find out more about how these factors affect your car insurance price, talk to an independent agent in our network. These agents live and work in your neighborhood, so they know what risks you face on the road. 

Your local member agent will help you find the best car insurance for your needs and budget.