How Much Is Car Insurance for September 2023?

In this article, we’ll delve into the question, “How Much is Car Insurance?“. The cost of car insurance is influenced by multiple factors, including your driving history, location, the coverage options you choose, and car model. We will unpack how each of these elements impacts your insurance rates.

Key Takeaways

  • On average, full coverage car insurance costs $2,014 annually, while minimum coverage stands at $622 annually. Monthly, you have to pay around $168 for full coverage and roughly $52 for minimum coverage.
  • Geico, Erie, and USAA provide the most affordable full coverage options, but availability varies for different drivers.
  • For the cheapest minimum coverage, Auto-Owners, Geico, and USAA tend to lead among the companies we’ve looked at.
  • Some vehicles experience higher average insurance premiums than others because of MSRPs, safety features, repair costs, parts availability and other variable characteristics. 

What Does Car Insurance Cover?

Owning a car brings the potential for accidents and damages. To mitigate the financial fallout of these unexpected events, car insurance can cover costs like medical bills, legal fees, and vehicle repairs. However, what your insurance covers and how much it costs largely hinges on your chosen policy. Therefore, it’s crucial to select a policy that provides adequate protection. 

Moreover, each state has its own car insurance mandates. While most states insist on bodily injury and property damage liability, many also require personal injury protection and uninsured motorist coverage. And if you’re financing or leasing your car, your lender may require both collision and comprehensive coverages.

Here are the various types of car insurance coverage:

Liability insurance

Liability insurance comes into play when you’re at fault in an accident. It covers the damages to the other party’s vehicle and property, including their medical bills and property repairs, up to a set limit. Additionally, this insurance can handle your legal fees if you’re sued. However, it’s essential to note that liability insurance primarily benefits the other party, not you. 

Liability insurance

Every state has its own regulations regarding liability insurance. While most states require it, New Hampshire and Virginia stand out as exceptions. In New Hampshire, drivers aren’t mandated to have liability insurance, but they must prove their ability to cover any damages if responsible for an accident. Meanwhile, in Virginia, you can opt to drive without insurance, but this decision comes with a $500 fee.

Collision coverage

Collision coverage can cover damages to your vehicle when it hits another car or object, but typically, it doesn’t cover incidents involving animals. 

Unlike liability insurance, which takes care of the other party’s expenses, collision coverage is geared towards your vehicle’s repair costs, minus your deductible. This means that even if the accident is your fault, you’re still protected and can get support for your repair costs.

Comprehensive coverage

Comprehensive coverage protects your vehicle from damages not caused by collisions. It covers occasions such as natural disasters, including fires and floods, as well as theft or vandalism. 

Similar to collision coverage, comprehensive insurance usually comes with its own deductible.

Uninsured or underinsured motorist coverage

Uninsured motorist coverage pays your medical and repair expenses if a driver lacking insurance strikes you, and underinsured coverage steps in when the at-fault driver’s insurance isn’t enough to cover all your expenses. While some states make this coverage mandatory, it’s prudent to have it regardless for extra protection. 

Uninsured or underinsured motorist coverage

It’s important to understand that this coverage comes into play when you’re not the one at fault. However, the application varies by state. Some states require the other driver to be legally at fault, while others use a no-fault system, refraining from blaming any specific party.

Personal injury protection

Personal injury protection (PIP) covers medical expenses for you and your passengers after an accident, complementing your medical insurance. It can also address related costs, like child care or lost income due to injuries. 

While some states mandate PIP as part of their minimum auto insurance, not all insurers offer it everywhere. However, PIP is essential in no-fault states, as outlined by the Insurance Information Institute.

Compare Auto Insurance Rates

The average cost of car insurance varies based on several factors. Age, states, the insurance company chosen, and driving record all play a role in determining the price. Let’s delve deeper into how these factors can influence the overall cost.

How Much does Car Insurance Cost By State?

On average, car insurance costs about $2,014 per year, while minimum coverage comes in at $622 annually. Yet, these figures can fluctuate based on several factors. 

For instance, your state of residence can affect insurance rates because of differences in accident frequencies, claim reports, and even the cost of labor and parts. Therefore, when asking about the cost of car insurance in a specific location, it’s essential to consider these factors.

How Much does Car Insurance Cost By State?
StateAvg. annual full coverage premiumAvg. annual min. coverage premium
Alabama$1,843$441
Alaska$1,946$421
Arizona$1,810$587
Arkansas$1,907$443
California$2,291$636
Colorado$2,121$500
Connecticut$1,533$620
Delaware$2,103$801
Florida$3,183$1,128
Georgia$2,085$639
Hawaii$1,275$344
Idaho$1,133$267
Illinois$1,806$552
Indiana$1,295$327
Iowa$1,315$223
Kansas$1,878$416
Kentucky$2,124$678
Louisiana$2,909$805
Maine$941$225
Maryland$1,971$815
Massachusetts$1,262$429
Michigan$2,691$1,104
Minnesota$1,760$585
Mississippi$1,771$446
Missouri$1,943$490
Montana$1,889$310
Nebraska$1,624$359
Nevada$2,779$973
New Hampshire$1,262$319
New Jersey$1,754$782
New Mexico$1,591$346
New York$3,139$1,371
North Carolina$1,446$432
North Dakota$1,302$269
Ohio$1,266$338
Oklahoma$1,998$406
Oregon$1,415$616
Pennsylvania$2,040$428
Rhode Island$1,886$551
South Carolina$1,532$524
South Dakota$1,553$276
Tennessee$1,429$371
Texas$2,019$565
Utah$1,510$539
Vermont$1,061$238
Virginia$1,439$494
Washington$1,410$515
Washington D.C.$2,072$607
West Virginia$1,580$421
Wisconsin$1,292$358
Wyoming$1,582$263

Source: Bankrate

So, According to Bankrate, What are the cheapest states for car insurance in 2023?

On average, drivers in states like Maine, Vermont, Idaho, New Hampshire, and Massachusetts enjoy the most affordable annual full coverage car insurance rates. This cost advantage might be due to a lower cost of living, lower probability of accidents and claims, and less traffic congestion. Thus, these elements play a role in influencing these states’ more favorable insurance premiums.

  • Maine: $941 per year — 53 percent below national average
  • Vermont: $1,061 per year — 47 percent below national average
  • Idaho: $1,133 per year — 44 percent below national average
  • New Hampshire: $1,162 per year — 42 percent below national average
  • Massachusetts: $1,262 per year — 37 percent below national average

According to Bankrate, What are the most expensive states for car insurance?

From our research, drivers in Florida, New York, Louisiana, Nevada, and Michigan face the highest average yearly costs for full coverage car insurance. These higher costs might be related to more frequent claims in these states, indicating a higher overall insurance risk for drivers.

  • Florida: $3,183 per year — 58 percent above national average
  • New York: $3,139 per year — 56 percent above national average
  • Louisiana: $2,909 per year — 44 percent above national average
  • Nevada: $2,779 per year — 38 percent above national average
  • Michigan: $2,691 per year — 34 percent above national average

The Average Cost of Car Insurance by Company

On average, top national insurers offer car insurance ranging from roughly $1,300 to $2,600 annually for full coverage, with Geico and Erie being the most affordable.

However, because each insurance company uses its unique method for determining rates, individual costs can vary. Remember, your chosen coverage type influences the price. In fact, full coverage car insurance typically costs about 224% more than the basic minimum coverage.

Below is a table highlighting the average yearly and monthly full coverage premiums from some of the leading car insurance companies in the U.S based on their market share.

Average cost of full coverage by insurance company

Insurance providerAnnual costMonthly cost
Allstate$2,630$219
American Family$1,700$142
Amica$1,467$122
Auto-Owners$1,361$113
Erie$1,356$113
Farmers$1,598$133
Geico$1,353$113
Mercury$1,547$129
Nationwide$1,422$119
Progressive$1,642$137
State Farm$1,480$123
The Hartford$2,104$175
Travelers$1,551$129
USAA$1,361$113

Source: Bankrate

How Much Does Car Insurance Cost by Age & Gender? 

Car insurance rates often hinge on several factors, with age being a significant one in many states. Younger and elderly drivers tend to face higher premiums, as they’re statistically more prone to accidents due to inexperience or slower reactions.

Average Annual Premium by Age and Gender

20-year-old25-year-old40-year-old60-year-old
Male$4,638$2,552$2,020$1,832
Female$3,999$2,393$2,008$1,816

Source: Bankrate

Car Insurance Costs for Young Drivers

Statistically, young drivers are more likely to be in car accidents, and sadly, these incidents tend to be more severe. Specifically, the fatal crash rate for drivers aged 16 to 19 is nearly triple that of drivers aged 20 and up.

In the tables below, young drivers often face higher premiums due to their limited experience on the road. 

AgeAnnual full coverage premiumAnnual min coverage premium
16-year-old$4,392$1,470
17-year-old$4,102$1,362
18-year-old$6,110$1,967
19-year-old$4,720$1,472
20-year-old$4,319$1,322
21-year-old$3,420$1,042
22-year-old$3,163$955
23-year-old$2,929$921
24-year-old$2,837$850

*16- and 17-year-old rates represent the total cost of the teen driver added to their parent’s policy with student discounts applied.

**18- through 25-year-old rates represent renters (not homeowners) calculated on their own policy.

How Much does Car Insurance Cost by Credit Score?

Drivers with poor credit typically pay about 73% more for full coverage auto insurance than those with good credit. However, it’s worth noting that insurers look at an insurance credit tier, which might differ from credit scores provided by agencies like Experian, TransUnion, or Equifax. 

How Much does Car Insurance Cost by Credit Score?

Meanwhile, in states like California, Hawaii, Massachusetts, and Michigan, regulations either ban or heavily restrict car insurance companies from using credit when determining rates.

Average car insurance cost by credit score

Avg. monthly cost*Avg. annual cost*
Poor credit score$290$3,479
Average credit score$181$2,176
Good credit score$168$2,014
Excellent credit score$147$1,764

*rates are for full coverage

How Much does Car Insurance Cost by Vehicle Type?

The kind of car you drive greatly affects your insurance costs. Factors like the cost and availability of parts, labor rates, the car’s accident history, and its safety features all play a role in determining your premium. 

Here are some types of vehicles that tend to be expensive to insure:

  • Large SUVs: Their large size and passenger capacity can lead to damage and injuries in accidents
  • Sports cars: Vehicles designed for speed, increasing accident risk. Moreover, sports cars also have expensive costs for replacement parts
  • High-end luxury cars: Costly replacement parts due to luxury components. The higher purchase price can result in elevated insurance premiums
  • Hybrid and Electric Vehicles: Parts and labor for these vehicles can be pricey, which mean you have to pay higher premiums for full-coverage policies for hybrids and EVs.

In the table below, we’ve listed vehicle makes and models that cater to different lifestyles and budgets. 

Vehicle typeAvg. monthly cost*Avg. annual cost*
BMW 330i$209$2,513
Ford F-150$143$1,753
Honda Odyssey$145$1,735
Toyota Prius$176$2,117
Tesla Model 3$215$2,577
Audi Q5$188$1.869
Toyota RAV4$156$1,603
Subaru Outback$134$1,820
Jeep Wrangler$152$2,743
Ford Mustang$207$2,488

*rates are for full coverage

Car Insurance Cost by Provider

The cost of car insurance can differ greatly based on the provider you choose. For instance, several national and regional companies offer rates that are below the national average for full-coverage car insurance.

Car Insurance CompanyMonthly Cost EstimateAnnual Cost Estimate
USAA$126$1,512
Erie Insurance$122$1,458
Nationwide$119$1,433
Geico$133$1,596
State Farm$138$1,657
Progressive$169$2,030

How does Driving Record Impact the Car Insurance Cost?

Drivers with an at-fault accident can expect to pay about 42% more for car insurance than those with a clean driving record. However, if there’s a DUI conviction, the cost jumps significantly, with premiums rising by an average of 93%. This highlights how serious incidents, like DUI, label drivers as high-risk and subsequently drive up insurance costs.

  • Speeding tickets: They can lead to an average increase in full coverage premiums by 21%. However, insurance carriers like Erie and Auto-Owner’s offer rates that remain below the national average even after such convictions. 
  • At-fault accident: An at-fault accident can push your monthly premium from $168 to $238, marking a 42% annual hike. Yet, if it’s your first accident and you have accident forgiveness coverage. In that case, you might avoid this increase
  • DUI conviction: It could elevate your monthly premium to over $300 and linger on your record for a decade or longer. The cost impact varies by state; for instance, a full coverage policy post-DUI averages $3,797 annually in Kentucky, but jumps to about $5,604 in Louisiana.

5 Tips To Lower Car Insurance

When searching for car insurance online, you might encounter quotes that stretch your budget. However, don’t despair. There are several effective strategies you can use to find more affordable car insurance options.

5 Tips To Lower Car Insurance
  • Shop around:  When events in your life change, like getting married, buying a house, or even an improvement in your credit score, it’s a good idea to revisit your car insurance rates. By comparing rates from multiple insurers during these times, you might find opportunities for more affordable premiums. So, it’s always beneficial to stay updated and see if you can secure a better deal.
  • Bundle Plans: Combining your home and auto insurance often leads to discounted premiums. Similarly, insuring multiple vehicles on the same policy can also result in savings. So, it’s worth considering these bundling options when looking for ways to reduce your insurance costs.
  • Take a class: Every state provides state-approved driver safety programs, typically lasting around six to eight hours. After completing these courses, many insurers offer discounts, making it a beneficial step for drivers seeking to reduce their premiums.
  • Use a monitoring app: Many insurance providers now offer usage-based programs. By signing up, an app will monitor your driving habits, such as braking distance, average speed, and driving times. Based on this data, you can earn rewards or discounts for maintaining good driving behavior. This approach promotes safer driving and offers potential savings on your insurance.
  • Reduce coverage: As your vehicle gets older, it might not be cost-effective to maintain comprehensive and collision insurance. Generally, if your annual premium surpasses 10% of your car’s overall value, it’s a good time to consider dropping such coverages. This approach ensures you’re not overpaying for protection as your car depreciates.

Our Methodology

To ensure our readers receive objective and precise information, we’ve created a detailed rating system for evaluating the best car insurance companies. We gathered data on numerous auto insurance providers and assessed them based on various factors. Consequently, each provider received an overall score, with those garnering the most points ranking at the top.

Here are the factors our ratings include:

  • Cost: We evaluated rates using data from Quadrant Information Services and also factored in available discounts.
  • Coverage: Companies offering diverse insurance options were seen as more aligned with consumer needs.
  • Reputation and Experience: We weighed market share, expert ratings, and company tenure.
  • Availability: Companies with extensive state presence and minimal entry barriers scored higher.
  • Customer Experience: We analyzed complaint volumes from the NAIC, J.D. Power satisfaction ratings, and our own insights into service team responsiveness and approachability.

How Much is Car Insurance: FAQs

How much is car insurance per month?

On average, car insurance costs about $179 per month, as indicated by NerdWallet’s analysis. However, several factors, including your location, the type of vehicle you drive, and your driving history, can influence this rate. Therefore, it’s beneficial to compare different insurance rates to find the most affordable option tailored to your needs.

What’s the difference between full and minimum coverage?

A full coverage policy includes not only the basic liability coverage but also collision and comprehensive coverage. Collision covers damages from accidents between your car and another vehicle or object, while comprehensive covers non-collision events like fire, flood, vandalism, and theft. 

In contrast, minimum coverage usually means only meeting the state’s required liability limits, typically covering bodily injury and property damage. Although it’s often more affordable, it’s wise to go beyond these minimum limits and consider full coverage for more comprehensive protection against accidents or unforeseen events.

What is the number one auto insurance in the U.S.?

State Farm stands out as the top car insurance provider in the country, clinching our Editor’s Choice award. Moreover, the National Association of Insurance Commissioners (NAIC) notes that they dominate with a 16.8% market share. In 2022 alone, State Farm recorded about $46.6 billion in direct premiums.

Which car insurance company is the cheapest?

Based on our findings, Auto-Owners, USAA, Geico, Amica, and Erie often offer some of the most affordable car insurance rates. However, car insurance rates vary due to factors like driving record, location, mileage, experience, and specific coverage needs.

Consequently, two drivers might get different quotes from the same company for identical coverage. For instance, a driver wanting various endorsements might find a different affordable option than someone seeking only liability coverage. Therefore, to find the best fit for your needs and budget, it’s wise to get quotes from multiple providers and compare their offerings.

Bottom Line

How much is car insurance”? varies widely based on numerous factors, including location, driving history, and vehicle type. While it’s essential for drivers to shop around and compare rates, understanding one’s specific needs and requirements can help them find the best deal.

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