Depending on who and where you are and what and how you drive, you could pay as little as $560 or more than $36,900 annually for car insurance. That’s nearly a 6500% difference. The auto insurance industry is incredibly complex (and often volatile) and is regulated differently in each state. This gives way to a national total of 655 carriers (insurance companies) using a mix of 43,520 rating factors. Any given person could conceivably choose from millions upon millions of car insurance quotes.
But external factors, too, are now driving change in the current state of car insurance. How is the insurance industry reacting to changes in technology, economics, and driving behaviors and the potential risks they pose?
The Zebra is the nation’s largest car insurance comparison marketplace and an unbiased source for pricing, coverage, and all things car insurance. We explored current and trending car insurance rate data*, broke it down by state, and pulled millions of rates to examine the current state of car insurance pricing, what causes car insurance prices to skyrocket or plummet, and what consumers should know as they shop for insurance. See some of the key findings below...
The national average annual insurance premium in 2016 is $1,323. Ohio has the lowest rates nationally ($764/annual premium) and Michigan has the highest ($2,087/annual premium).
Using 2016 rates for current year models of the most popular* cars (sedans), trucks, SUVs, vans, luxury cars, and “green” (hybrid/electric) vehicles:
The ideal insurance customer in most states? Female, married, age 59, homeowner with excellent credit who has had insurance for ﬁve years with no trafﬁc violations on her record.
Teen drivers pay a national average annual premium of nearly $5,000, which is more than three times the average rates of anyone ages 30 to 85.
Drivers using telematics have seen very little impact to their rates as the products have been slow to take off, despite the data they can provide about driver behavior.
Of nine common safety devices, only one lowers rates for drivers who use them, and by just $5 per year.
With Telematics +
With Telematics+ blind spot warning device, collision preparations system, driver alertness monitoring device, heads-up display, lane departure warning device, night vision device, parking assistance device, and rear-view camera.
Texting and driving is one of the most dangerous behaviors behind the wheel, but insurance companies by and large are not penalizing those distracted drivers. Across all 50 states and Washington D.C., cell phone and texting violations have the least impact on auto insurance premiums, raising rates about 2% nationally. One cell phone use violation raises rates an average of about $30 annually, but a single DUI raises rates more than $1,000.
This is more than rate increases for any other accident or violation, including at-fault collisions, reckless driving, and high speeding. In fact, a DUI will raise rates over 100% in seven states, over 200% in Hawaii, and over 350% in North Carolina. And although DUIs increase average annual premiums the most nationally, 23 states cite racing as the most costly violation.
Purchase your policy at least 10 days before you need it activated, pay in full up front, and pay online = save 10% on car insurance.
Buy an older car. A 5- year-old version of a certain model is nearly 13% less expensive to insure than its current model year version.
Bundle your auto policy with homeowner or renter’s = save 7.5%.
Don’t let your insurance coverage lapse. Even after being insured for just a year, rates drop at least 7.7%. Maintain continuous coverage and shop around for insurance every 6 months (and especially after 1, 3, and 5 years of being insured) to see what new quotes might work best for you.
Pinching pennies? These tips will save you under 1% on your premium:
Drive safely! For your own well-being and that of others around you, of course, but you’ll also save yourself a minimum 40% increase in rates by avoiding your state’s most costly violation (often DUI or racing).
Increase your credit score by one tier = save 17%.
Auto insurance is a huge portion of your total cost of ownership (TCO) of a vehicle. In fact, with lower gas prices, in many cases, insurance is the largest car-related expense after the car itself, so make sure you factor insurance into your budget and can afford your coverage. (It will hurt you later to have gaps in coverage or miss payments). Also, make sure to get the coverage you need - it’s not just about the lowest rates.
Compare insurance quotes free at TheZebra.com
In June 2016, The Zebra explored auto insurance pricing data using its quote engine, comprising data from insurance rating platforms and public rate ﬁlings. Analysis includes annual auto insurance premium data across all United States zip codes for a base driver proﬁle: 30-year-old single male driving a 2012 Honda Accord EX. For more detail on methodology, see The Zebra’s 2016 State of Auto Insurance Pricing Report.Contact The Zebra if you have a speciﬁc data request or would like more info on auto insurance research. Contact Us