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Learn more about the factors that dictate your car insurance rates, compare top insurers, and save.
If you’ve ever compared car insurance rates, you know how many options are available. Depending on a variety of individual rating factors, certain companies will price your insurance differently. You could end up paying more by choosing the wrong company or failing to compare enough companies. We've outlined the factors that go into your car insurance premiums, as well as some tips for how to find the best possible rates. Let’s get started.
Your auto insurance rate depends on who you are as a driver, as well as your age, your credit, your vehicle, and your location. How insurance companies weigh these attributes is reflected in your premium. For example, having a limited driving history or a poor credit score can raise your rates dramatically. Our analysis of major rating factors shows how premiums shift from company to company.
There are many reasons to insure your vehicle. The most basic reason is that it is required by law. Even if you own your vehicle, the law mandates that you carry at least liability insurance. If you’re leasing or financing your car, you may need to carry additional auto insurance — namely, comprehensive, collision, and sometimes gap insurance.
Car insurance is designed to financially protect drivers and their vehicles after damaging incidents. A car insurance company's financial resources will compensate you for damages sustained by your vehicle — or others' person or vehicles — if they are affected by a collision.
If you have teens or you’re a teen driver, you know it’s expensive. In many cases, adding a teen to your policy will nearly double your premium. Comparing the top car insurance companies across the US, State Farm, Nationwide, and USAA, are the cheapest companies for a teen driver.
|Insurance Company||6-month Premium|
If you want more info on car insurance for teens, reference our additional articles:
The age of 25 is a big turning point for car insurance savings. But no matter how much you save, you’re probably still paying more than you’d like. In order to find the cheapest car insurance for 25-year-olds, we created a user profile and generated rates from eight popular auto insurance companies.
|Insurance Provider||6-month Premium|
USAA is the cheapest car insurance company for 25-year-old drivers, with GEICO a bit more expensive. Although Liberty Mutual and State Farm are the most expensive options for older drivers, they could end up being affordable options for drivers with violations on their records (read on for more info).
If you’re looking for more information on how to get car insurance as a young driver, see our additional articles:
Between the ages of 30 and 60, car insurance rates don’t fluctuate much based only on age. As you get into your late 50s and 60s, your age becomes a more important determinant of your rate. For a profile of a married couple without children drivers, Geico and Progressive offer the cheapest rates, all other metrics constant.
|Insurance Provider||6-month Premium|
Looking for more information? See our additional articles.
Naturally, insurance companies use your driving past as an indicator of how you will drive in the future. It can be difficult to find affordable car insurance if you have a checkered driving history. While it’s very unlikely you will find an insurance company that won’t increase your premium after an at-fault accident or other violation, the degree of the rate increase will vary by company. Let’s compare rate increases for some common violations across major insurance companies.
On average, an at-fault property damage accident will raise your premium by an average of $612 per year. Because most insurance providers will charge you for three years after an accident, this $612 increase equates to more than $1,800 in total fees. If you’re thinking of filing a claim, consider the overall cost of the claim versus what the claim would cost to pay out of pocket. Compare this $1,837 penalty — plus your deductible (if applicable) — to the out-of-pocket expense. While this is nice information to know before filing a claim, it won’t help if you’ve already filed a claim. If you have an at-fault accident on your insurance history, consider USAA or State Farm.
|Insurance Provider||No Accident||After At-Fault Accident|
In most states, a DUI is the most costly violation you can receive. Moreover, in states like California, it will stay on your insurance record for 10 years! Based on our analysis of the most popular car insurance companies, this would set you back an average of $1,200 in insurance rate increases during that 10-year period. To limit costs, do your due diligence and shop around: Progressive and USAA are the cheapest insurance options after a DUI — consider starting with those providers.
|Insurance Provider||None||6-month premium|
Like a DUI, a reckless driving citation can raise your car insurance rates. If you’ve received a reckless driving citation, your best bets for cheap car insurance are USAA and State Farm, despite the latter being one of the more expensive insurance companies if you don’t have a violation. This shows the importance of comparing car insurance rates carefully — your driving profile will be handled differently by every carrier.
|Company||None||Premium w/ Reckless Driving|
For more information on driving with a not-so-great profile, check out our more in-depth articles here
Another major contributor to your car insurance rate is your credit score. While not directly related to your driving, car insurance companies believe your credit score says a lot about what kind of client you’ll be. Compare how car insurance companies factor credit score into their rates:
If you have very poor credit, the cheapest car insurance company is Nationwide. Here, your premium will be more than $435 less than the group average. Compared to the highest credit level, drivers with bad credit pay nearly $1,450 more per year for auto insurance. If you pay off a loan or otherwise improve your credit score, you should shop around for car insurance as your premium should change. Just another reason to keep your score up!
|Company||Credit Score: (300-579)|
With rates $400 less than the group average, USAA offers the cheapest insurance for drivers with "fair" credit scores. Even so, a fair credit score will result in elevated rates. While the average premium for fair credit drivers is $854, that's $229 more than those with "great" credit are paying, with all other metrics constant.
|Company||Credit Score: (580-669)|
As we get into the higher levels of credit score, the car insurance rates get a little more competitive. Although those with a credit score between 670-739 are still paying over $200 more than the highest credit tier, you can lower your bill by selecting USAA for your car insurance provider.
|Company||Credit Score: Good (670-739)|
Between "very good" and "great" credit, there's an average of $93 in annual premium difference. For our user profile, USAA and State Farm are the cheapest for this credit level. On average, these companies will cost $76-99 per month for auto insurance.
|Company||Credit Score: Very Good (740-799)|
At the highest credit trier, USAA is still the cheapest car insurance company. At $198 less per year than the group average, USAA will cost you $427 per year for insurance - about $71 per month for auto insurance.
The type of vehicle you insure will impact your car insurance rate. Insuring a large truck or luxury vehicle is more expensive than insuring a sedan with standard trim. This is because collision and comprehensive coverage are designed to replace your vehicle in the event of an accident. The more it costs to replace your vehicle, the more it costs to insure it. Simple as that.
Your location can have a huge impact on your insurance premium. Like many industries in the US, car insurance is regulated at the state level and is dictated by each state’s regulations. If you live in an area prone to floods, hurricanes, or wildfires, your rate will be elevated, as insurance companies compensate for these risks. Dive into the data below to find check out your expected costs with our list of car insurance rates by city.
If you live in an area with unusual state regulations or heightened risk of weather-related claims, shopping car insurance options will be vital. Not every car insurance company offers policies in every state, which can make pricing less competitive. If you live in storm-prone states like Louisiana or Florida, you might find it harder to get a competitive rate.
|State||Average 6-Month Premium|
While many factors comprise your car insurance costs, we tried to touch on some of the bigger ones. If you’re interested in all the other rating factors, such as your homeowner status or education level, see our additional articles:
Now that you understand what contributes to car insurance rates, let’s talk about how to shop for car insurance. Unless you want to spend a significant amount of time talking to an insurance agent, make sure you have the following information ready when you begin your car insurance shopping process.
While you might want to finish shopping for car insurance as quickly as possible, it’s important to do your due diligence and find the right company. At the end of the day, car insurance is designed to protect and benefit you. If you were to be injured or have your car totaled in an accident, your insurer’s customer service and claims satisfaction would be vital.
We’ve listed America's best auto insurance companies, according to J.D. Power Customer Satisfaction Surveys, with corresponding average annual premiums.
Highest-ranked car insurance companies in the US
|Farm Bureau Insurance – Tennessee||$658|
|Texas Farm Bureau||$905|
There isn’t a definitive answer to the question, “which company is the cheapest?” Some companies are cheaper than others, plain and simple, but individual details of your driving profile can affect which companies offer you the cheapest rates. For example, while Nationwide wasn’t the cheapest for a driver with a clean record, it was the relatively cheap for a driver following an at-fault accident. The best way to find cheap car insurance is to compare as many companies as possible using your driving profile.
While JD Power-recommended companies above aren’t among the cheapest of the insurance companies we’ve examined, they might suit your needs. It’s important to think beyond price to find a comfortable middle ground between claims satisfaction and affordability. Use The Zebra’s side-by-side insurance comparisons to avoid some of the legwork involved in insurance shopping.
The auto insurance rates displayed in our articles are based on the 2019 results of The Zebra’s comprehensive car insurance pricing analysis. In our analysis of all US zip codes — including Washington D.C. — the sample user profile consisted of a 30-year-old single male driving a 2013 Honda Accord. To generate pricing specific to particular rating factors, we adjusted the driving profile based on pricing factors commonly used by car insurance companies.
For more auto insurance information, please reference The Zebra's comprehensive State of Insurance study.
This article was written by one of The Zebra’s licensed insurance experts. Each article is thoroughly researched to ensure we provide accurate, unbiased, and useful information.
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