Average Cost of Auto Insurance: Everything You Need to Know

Auto insurance is an unavoidable expense for every driver. It is essential for protecting yourself and others on the road from unforeseen events. However, the cost of auto insurance can vary widely based on several factors, including your age, location, driving record, type of car, and coverage options. In this article, we will discuss everything you need to know about the average cost of auto insurance, including tips for saving money, how to choose the right coverage, and frequently asked questions.

Factors That Affect Your Auto Insurance Cost

The cost of auto insurance is influenced by several factors, including:

Other factors that may affect your insurance cost include your gender, marital status, credit score, and insurance history. It is essential to understand how these factors can impact your rates, so you can make informed decisions when buying car insurance.

The Average Cost of Auto Insurance

According to the National Association of Insurance Commissioners (NAIC), the average cost of auto insurance in the United States was $935.80 per year in 2016. However, this amount can vary widely based on several factors, including the state you live in, the coverage options you select, and your driving history.

The following table shows the average annual auto insurance premiums by state according to the NAIC:

Tips for Saving Money on Auto Insurance

There are several ways to save money on your car insurance premiums. Here are some tips:

Shop around

Don’t settle for the first quote you receive. Shop around and compare prices from different insurance companies to find the best deal.

Bundle your policies

Many insurers offer discounts if you bundle multiple policies, such as auto and home insurance, with them.

Choose a higher deductible

A higher deductible means you will have to pay more out of pocket if you get into an accident, but it can also lower your monthly premiums.

Ask for discounts

Many insurance companies offer discounts for safe driving, good grades, low annual mileage, and other factors. Ask your insurer about the available discounts.

Drive a safe car

Cars with safety features such as airbags, anti-lock brakes, and anti-theft devices may qualify for lower insurance rates.

FAQ

What is the minimum car insurance required by law?

The minimum car insurance required by law varies by state. It typically includes liability coverage, which pays for damages and injuries you cause to others in an accident.

What is comprehensive car insurance?

Comprehensive car insurance covers damages to your car that are not caused by collisions, such as theft, vandalism, and natural disasters. It is an optional coverage that is usually more expensive than basic liability insurance.

How long does a car accident stay on your insurance?

Accidents can stay on your driving record and affect your insurance rates for up to three to five years, depending on the state and severity of the accident.

What is an SR-22 filing?

An SR-22 filing is a certificate of financial responsibility required by some states for high-risk drivers who have been involved in accidents or committed serious traffic violations. It is usually required for at least three years and can result in higher insurance rates.

What should I do if I can’t afford car insurance?

If you can’t afford car insurance, you may be eligible for state-sponsored programs or low-cost insurance options. You can also consider reducing your coverage or increasing your deductible to lower your premiums.

What happens if I let my car insurance lapse?

If you let your car insurance lapse, you may face fines, higher insurance rates, and a suspended license. It is essential to maintain continuous insurance coverage to avoid these consequences.

In conclusion, the average cost of auto insurance can vary widely based on several factors, including your age, location, driving record, type of car, and coverage options. It is crucial to compare prices from different insurance companies, choose the right coverage options, and take advantage of available discounts to save money on your premiums. By understanding the basics of car insurance and following these tips, you can protect yourself and your wallet in case of any unforeseen events on the road.