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Average cost of car insurance in August 2022

MarketWatch logo MarketWatch 8/17/2022 Alisa Wolfson
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Car insurance is one of those pesky things that every driver should have, but hopes they never have to use. At a basic level, car insurance provides financial protection against damage to a vehicle or bodily injury resulting from collisions and other vehicle incidents. (You can get personalized auto insurance quotes here.)

There are many types of car insurance policies available to benefit drivers, including liability, collision insurance, comprehensive, uninsured motorist, medical payment coverage, personal injury and gap insurance. Depending on where a driver resides, state laws can dictate the type of coverage required.

What is the average cost of car insurance?

According to the Federal Reserve, the national average monthly insurance premium for private passenger auto insurance is $186 per month. “That said, a national average doesn’t tell us much because of all that goes into underwriting such as age, sex and marital status of the driver, not to mention the variation by state and locality plus the differences in insuring different vehicles,” says Michael Giusti, an analyst at

Bankrate’s 2022 study of average premiums reveals that full-coverage car insurance costs $1,771 per year and minimum coverage costs $545 per year in the United States. 

How much does car insurance cost by state?
State Average annual cost of full coverage
Alabama $1,760
Alaska $1,770
Arizona $1,743
Arkansas $1,806
California $2,190
Colorado $2,019
Connecticut $1,533
Delaware $1,963
Florida $2,762
Georgia $1,985
Hawaii $1,206
Idaho $1,065
Illinois $1,548
Indiana $1,242
Iowa $1,252
Kansas $1,802
Kentucky $1,954
Louisiana $2,864
Maine $876
Maryland $1,931
Massachusetts $1,296
Michigan $2,345
Minnesota $1,692
Mississippi $1,701
Missouri $1,861
Montana $1.795
Nebraska $1,538
Nevada $2,426
New Hampshire $1,182
New Jersey $1,891
New Mexico $1,489
New York $2,996
North Carolina $1,392
North Dakota $1,225
Ohio $1,200
Oklahoma $1,902
Oregon $1,371
Pennsylvania $2,002
Rhode Island $1,847
South Carolina $1,464
South Dakota $1,542
Tennessee $1,383
Texas $1,868
Utah $1,449
Vermont $1,000
Virginia $1,340
Washington $1,313
Washington DC $1,948
West Virginia $1,527
Wisconsin $1,249
Wyoming $1,510

*Car insurance average rates from Bankrate

You can get personalized auto insurance quotes here.

Why do car insurance averages vary by location?

Each state has its own minimum requirements for coverage. “Some states only require liability while others require personal injury protection or uninsured motorist coverage. Your insurance company will usually provide this information when you’re purchasing your policy or you can consult your local DMV,” says Michael Orefice, senior vice president of operations for SmartFinancial, a digital insurance comparison engine.

One of the largest factors in determining car insurance rates is your zip code, says Angele Doakes, property and casualty insurance expert at Policygenius. “This is because insurers are determining how risky it is to insure your car based on what it’s likely to experience. For example, if your area has a large population, you’re likely to encounter more drivers who could be a risk to you,” says Doakes. Similarly, if you’re somewhere facing many natural disasters that could damage your car, you could be looking at higher rates. 

Because insurance is regulated at the state level and laws vary by jurisdiction, when moving to another state, Scott Holeman at the Insurance Information Institute says, “be prepared for your car insurance requirements and your rate to change.” 

Insurance is regulated by each state’s insurance commissioner and the main thing those regulators do to set insurance prices, according to Giusti, is to look to see how much the insurers have paid out over the past for insurance claims in that state. “It gets more nuanced when you try to break that number down. Many experts point to state insurance laws, particularly how those laws handle things like liability claims and whether they cap payouts for particular kinds of cases. The risk of the community also comes in — are break-ins and thefts common in your community? And do the drivers in your state just get into more accidents?” says Giusti. 

You can get personalized auto insurance quotes here.

How much does car insurance cost by company?

There isn’t a clear-cut answer to this question because each company has different overhead costs and pricing models — and Giusti adds that even ownership structures can affect cost. “That’s not to mention that each one could be looking at different factors for the same driver — say credit score versus age. That’s why it’s so important to shop around and get several quotes rather than hoping for an overarching rule of thumb that will always apply,” says Giusti. 

If you shop around, Orefice says you’ll see that prices on car insurance can vary by hundreds of dollars. “If you have a clean driving record and haven’t comparison-shopped in a whole, you may save up to 40%. The average policy on a sedan costs $1,400 (according to a 2021 AAA study), so that’s a $560 savings,” says Orefice. Also keep in mind that discounts will vary as well, and qualifying for discounts can result in a lower monthly payment.

How do age and gender impact car insurance cost?

Some states don’t use gender as a factor when calculating insurance rates, but some do. Indeed, gender is banned as a car insurance rating factor in California, Hawaii, Massachusetts, Michigan, North Carolina and Pennsylvania,” says analyst Cate Deventer.  “According to some statistics, women pay less, but there is no hard-and-fast rule and the reality varies in each state,” says Orefice. One reason for the discrepancy: A study from the IIHS found that male drivers of all ages are 63% more likely than female drivers to be involved in a fatal crash, with men ages 16 to 19 almost twice as prone to fatal accidents, therefore increasing their insurance premiums.

Meanwhile age is nearly always used. Teens and new drivers pay the highest rates, and then rates slowly recede as you get older and then rise again for seniors, says Orefice. Typically, drivers ages 25 and under have the highest rates, followed by those 65 and older.

Age and gender often interplay to create your insurance rates, too. “A married 40-year old woman is going to pay much less than a 16-year old male. That’s a fact,” says Giusti. For insurers, age and gender are proxies for risky behavior. “According to their actuarial tables, that 40-year old woman is much less likely to get into a drag race or do donuts or engage in other risky behavior that might lead to claims,” says Giusti.

How does credit score impact car insurance cost?

Some insurance companies in some states use credit-based insurance scores — these are based at least in part on a consumer’s credit information — to assess a driver’s risk profile. “The general theory behind insurance scores is that those who responsibly manage their finances are more likely to drive responsibly. Therefore, drivers with higher credit scores generally receive lower insurance premiums while those with lower insurance scores are more likely to pay higher premiums,” says Orefice. Credit-based insurance scores are used to determine how likely an insured person is to have a claim, and it does take into account one’s credit report. Insurance companies often used credit-based insurance scores as one of the many markers in their risk-assessment process.

But, credit score isn’t always used to determine insurance cost. Ben Moore, insurance specialist at NerdWallet, says using a credit-based insurance score to price rates is banned in California, Hawaii, Massachusetts and Michigan. 

How do driving records impact car insurance cost?

One of the largest factors in determining your rates is your motor vehicle report (MVR), which lists any driving violations or accidents you’ve had, says Deventer.

Insurance companies use driving records to assess a customer’s risk and typically look most at the past 3 to 5 years of driving history. “Drivers with multiple claims and accidents in their history are more likely to drive recklessly and file an insurance claim. Insurance companies charge higher premiums to reflect the driver’s increased risk,” says Orefice. Fortunately, good drivers can earn a safe driver discount if their carrier offers it, but you typically need to hold a clean driving record for a certain number of years to qualify.

You can get personalized auto insurance quotes here.

How does vehicle type or model impact car insurance cost?

Some cars are safer than others and insurers consider that when you are being rated for car insurance. Also, some cars are stolen or have parts stolen more than others and thereby pose a higher risk for a comprehensive coverage claim. 

  • Luxury and sports cars often cost more to insure because they typically have higher repair bills and cost more to replace if totaled in a covered accident.
  • Cars with parts that are hard to get or that require shipping from overseas often have higher premiums because of the cost associated with garnering parts.

Holeman says, “Insurers not only look at how safe a particular vehicle is to drive and how well it protects occupants, but also how much potential damage it can inflict on another car. If a specific vehicle model has a higher chance of inflicting damage when in an accident, an insurer may charge more for liability insurance.” 

Here are some common cars and what they might cost to insure.

Model Average annual full coverage premium
Audi Q5 $1,934
BMW 330i $2,225
Cadillac Escalade $2,188
Chevrolet Equinox $1,467
Chrysler Pacifica $1,463
Dodge Ram 1500 $1,697
Ford Explorer $1,536
Honda CR-V $1,369
Jeep Grand Cherokee $1,531
Mercedes C300 $2,187
Subaru Forester $1,419
Toyota Prius $1,729
Tesla Model 3 $2,283

*Source: Bankrate

How does prior coverage impact car insurance cost?

If you have a lapse in coverage, even if you weren’t driving during this time period, you will likely pay more for car insurance. You may want to look into maintaining car insurance even if you’re only carrying a non-owner car insurance policy to avoid paying more when you do need coverage.

How does mileage impact car insurance cost?

Driving is inherently risky, so the more you do it, the more risk you represent. “There are some usage-based policies that use onboard sensors that only require the driver to pay for miles they drive, which is the extreme low end. On the higher end, cars used for commuting are more expensive than a hobby rebuild that sits in a garage 98% of the time,” says Giusti.

If you no longer commute because you work from home, it would do you well to tell your agent that. They may have a tier of premiums that rewards the fact that you’re driving fewer miles everyday.

You can get personalized auto insurance quotes here.

Miscellaneous factors that impact car insurance
  • Marital status: Car insurance rates are often lower for married people.
  • Occupation: If you’re on the road a lot for work or you have a long commute, your premiums may be higher than someone who works from home and only uses their car for pleasure.
  • Education: Many insurance companies offer good student discounts based on one’s GPA. And, in general, the more educated you are, the more you can expect your premium to go down. Drivers with a bachelors degree can save hundreds of dollars annually, compared to those with only a high school diploma.
  • Homeowners: If you own a home, you may benefit from bundling your homeowners insurance and your car insurance, and get a discount on both policies
How to find the top car insurance quotes

Shop around! The best car insurance company will vary by driver. “Start by understanding your needs and wants. Are you looking for the cheapest policy possible or do you need a specific optional coverage? Do you value highly-rated claims service? Do you want a company that has a robust mobile app? Once you know what you’re looking for, you can do some research to find a car insurance company that could work for  your situation,” says Deventer. You can get personalized auto insurance quotes here.

Start by going to insurers’ websites and entering your information. Holeman recommends getting at least 3 quotes from different companies and different types of companies: those that sell through their own agents, those that sell through independent agents and those that sell directly to consumers via the phone, an app or the internet. “You can also work with an independent insurance agent who can pull quotes from multiple insurers for you so you can find the cheapest rate,” says Moore.

Another way to save is by bundling your auto insurance with other types of insurance such as homeowners, condo and renters, says Jason Fromm, general manager and vice president of insurance at Caribou, an auto loan refinancing company. “Leverage various discounts such as improving your credit to help save on your premium, complete advanced driver training courses in states that offer related discounts, insure all your cars with the same carrier to take advantage of a multi-car discount and if it makes sense for  you, change your coverage to raise your deductible and lower your premiums,” says Fromm.


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