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This article was reviewed by Andrew Flueckiger, a member of the Finder Editorial Review Board and certified insurance counselor and licensed insurance agent in five states.
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The average cost of car insurance is $1,300 a year or $108 a month, but rates vary depending on your car’s make, model and year, driving record, location, age, credit score and other factors.
For example, expect higher insurance rates if you live in a high-claims area, like a big city or an area with a high rate of uninsured drivers or car theft.
You typically pay your premiums monthly, yearly or every six months. Insurance companies may accept electronic transfers, credit cards or checks.
You might score discounts for paying for your policy annually, setting up autopay or getting bills online.
Your premium is what you pay every month to keep your policy and coverage. The deductible is what you pay in an accident before you can get a claim payout.
If lowering your car insurance premium is your main priority, switching car insurance could be one of the best ways to save. Compare auto insurance quotes with sample rates from insurers for California drivers.
| Company | Average annual rate | Average monthly rate |
|---|---|---|
| Geico | $394 | $33 |
| USAA | $416 | $35 |
| Progressive | $536 | $45 |
| Grange | $557 | $46 |
| Mercury | $564 | $47 |
| Kemper | $615 | $51 |
| 21st Century | $651 | $54 |
| Allied | $666 | $55 |
| Nationwide | $666 | $56 |
| Allstate | $666 | $59 |
| Liberty Mutual | $709 | $59 |
| State Farm | $726 | $61 |
| The Hartford | $727 | $61 |
No one wants to overpay for insurance. The best way to save on car insurance is by shopping around.
Each state holds its own minimum car insurance requirements, and deciding on other coverages depends on how much you’re willing to pay out of pocket in the event of a claim.
Car insurance rates can vary a lot based on your address in the US. The national average is $1,300 a year, but drivers in less populated states like Maine pay only $864, while Michigan drivers facing unique insurance laws see premiums around $2,394.
Compare car insurance for your state
In most states, each driver should have at least liability coverage, and sometimes personal injury protection or uninsured driver coverage. The types and limits of car insurance coverage you need are different for every state.
When shopping for car insurance, you might see limits written like 25/50/25, which means $25,000 bodily injury liability and $50,000 bodily injury per accident and $25,000 property damage limit.
Covers costs from injuries you cause another person in an accident.
Covers damage you cause to someone else’s property in an accident.
Covers medical services after an accident, regardless of fault.
Covers your own injury or car damage costs if the at-fault driver in an accident doesn’t have car insurance, or doesn’t have enough coverage.
Kirby George
Farmers Insurance, Licensed Insurance Agent
The biggest mistake I see people make is shopping for price.
When shopping for a car, a house or even a sweater, the average consumer understands they’re going to get what they pay for. If you want a Cadillac, you’re going to have to pay more than you would for a Ford.
If you want a brand-new 2,500-square-foot home, you expect to pay more than you would for a 20-year-old mobile home. When you shop for clothes, you pay more for new than you do at a thrift shop. Insurance is no different.
Your insurance quote comparisons look different across several companies because insurers use info about you to determine your driving risk and set your quotes.
This info is based on factors like where you park and how many miles you drive, including 10 factors that affect your rates the most:
A car insurance quote gives you an estimate for how much you’ll pay for car insurance with a particular insurer. Car insurance policies are usually rated for six or 12 month periods.
You also might see your coverage limits written as 50/100/25. These numbers represent the dollar amount of coverage you have for physical damage and bodily injury liability:
Once you decide on a company, your final rate is determined after the insurer looks at your motor vehicle record and once you decide on a payment plan.
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