Mathew B. Sims is Editor-in-Chief and has authored, edited, and contributed to several books. He has been working in the insurance industry ensuring content is accurate for consumers who are searching for the best policies and rates. He has also been featured on sites like UpJourney.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com and Safeco. He reviews content, ensuring that exis...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Jul 28, 2020

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Things to Remember...

  • Many factors affect the average car insurance monthly price.
  • The state that you live in can significantly affect the cost of your monthly premiums
  • Other factors such as your car’s safety rating may affect the cost of your premiums

The average auto insurance monthly cost is $79.58 in the US, but the average auto insurance monthly payment vary based on your driving history, crediting rating, and other factors. Most drivers want to manage essential recurring costs, such as auto insurance costs, to save money. Registering and driving an automobile requires the owner to present proof of financial responsibility.

Auto insurance protects the driver and the automobile they own. Auto insurance, as a kind of property and casualty insurance, also protects other drivers on the road.

Many factors affect the average monthly auto insurance rates. According the AAA, as of 2015, the average cost of insuring a car was around $1,115.

Other resources, such as the National Association of Insurance Commissioners, place the average annual cost of auto insurance closer to $1,400 (about $117 a month).

NAIC also found many drivers have saved money on auto insurance in recent years because of competition between insurers.

One simple way to compare multiple rates is by using our FREE online tool above. Get started by entering your ZIP code!

How do auto insurance costs vary by state?

Insurance costs can vary by state due to several factors. Here are some statistics of some commonly known states:

  • Drivers in Vermont pay an average of $1,250 a year (about $104 a month) for auto insurance, according to Vermont’s Department of Banking, Insurance, Securities, and Healthcare
  • Drivers in New Hampshire pay approximately $1,000 a year ($83 a month) for auto insurance, according to New Hampshire’s Insurance Department
  • Drivers in Minnesota pay about $1,200 a year (about $100 a month) for auto insurance, according to Minnesota’s Department of Commerce
  • Comparatively, drivers in New York, the District of Columbia, Louisiana, Mississippi, and Oklahoma pay the highest average premium rates for auto insurance
  • New York drivers pay an average $2,700 per year ($225 per month) for auto insurance premiums, reports New York’s Department of Financial Services

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How can I save money on average auto insurance costs monthly?

Some great ways to save big bucks on auto insurance include:

  • Participating in safe driver programs can net impressive savings to good drivers (15 percent  or more, according to AAA)
  • Buy at least six months of auto insurance coverage at once, rather than paying your auto insurance premium each month. Auto insurance companies may offer a discount for prepayments
  • Combine at least two insurance policies for discounted auto insurance rates
  • Consider your vehicle’s safety record. Your car’s safety rating may affect how much your monthly payments come out to be

Now that you’ve got more information, you can stop wondering “how much should I pay in auto insurance” and compare rates and save money by requesting free auto insurance quotes.

Use our FREE online tool below to compare quotes now!

How do I find the average cost of car insurance?

Figuring the average cost of car insurance is a complicated process because there are so many variables in calculating your average monthly auto insurance bill, but there are many auto insurance calculators online that you can use. There are many car insurance cost calculators online you use to figure this out at home.

Having a basic understanding of insurance will help in considering how much to pay for insurance.

Most purchasers of insurance understand that car insurance is required by law.

The laws that establish the necessity for insurance are established individually by state, so the cost of insurance also varies by state.

Even though an insurance company may provide insurance in several different states, the insurance company must file rate applications in each state based upon statistics and claims data derived from that particular state.

Be sure to always compare auto insurance the quick and easy way: Simply enter your ZIP code into the FREE tool located above to get started!

Factors that Affect Your Insurance Rates

  • Age – Ordinarily the older you are, the fewer possibilities of accidents you have
  • Gender – Statistically, young, unmarried males have more accidents than young, unmarried females
  • Marital status – Married people are less likely to have accidents than unmarried people
  • Number of years licensed – Experienced drivers are typically better drivers
  • Credit historyYour credit history can indicate the possibilities of property damage claims due to lack of income
  • Home ownership – If you own your own home, you are likely to be more stable and less careless in your driving
  • Occupation – Some occupations are riskier than others
  • Past driving history – Citations for driving under the influence are particularly flagged because these indicate habits that may lead to further accidents
  • Good student discountIf grades are Bs or better, the individual is less likely to have been distracted by extracurricular activities

When you tender an insurance application, it is sent to an underwriter who examines it for areas that may indicate unusual circumstances that might lead to an excess of claims.

If nothing flags the underwriter’s interest, it is sorted into categories of people they insure and rated accordingly.

Routinely insurance companies order a copy of your driving record, your credit record, and, sometimes, they will send investigators out to determine how you live and your reputation in your community.

This type of report is usually only ordered if the underwriter spots discrepancies between your application and the other records that are found.

Free Auto Insurance Comparison

Enter your zip code below to view companies that have cheap auto insurance rates.

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Vehicle Year, Make, and Model Can Affect Your Rates

Your application will give the year, make, and model of your automobile, as well as the coverage, desired.

The cost of the vehicle has some influence upon the rates you will be charged within certain parameters.

Purchasing a Lamborghini that has a base price of $400,000 or more can affect your insurance rates because experience with that type of vehicle is statistically rare, and the usual rating provisions are not applicable.

The insurance company’s experience statistically with a brand, model, and year of the automobile has the largest effect upon the cost of insurance.

The Coverage Limits that You Request

Every state has a required minimum amount of bodily injury coverage, property damage coverage, medical payments coverage, and uninsured/underinsured motorists coverage.

  • Bodily Injury Coverage – gives you protection in the event that you are legally liable for bodily injury damage to others
  • Property Damage Coverage – provides protection if you are legally liable for property damage to property owned by others
  • Medical Payments Coverage – pays for the medical expenses suffered by you and your passengers after an accident

Remember, these are the basic liability coverages required by law.

The reason for purchasing insurance is not only because of the law enacted within your state. Insurance protects you and your financial stability.

If each of us had to pay individually for automobile accidents, it could cause extreme financial distress.

Not many of us could produce liquid cash to pay a $150,000 hospital bill incurred because of an accident in which we are liable.

Therefore, as individuals, we cannot afford to accept the minimum protection required by law, even though it may cost less.

Are You Average?

In conclusion, a number of variables affect the cost of your automobile insurance.

Look at the average costs of car insurance in your state to determine if your premiums are reasonable, but you should request at least two insurance quotations using the same data.

Just as families and cars vary, so do insurance rates. It is possible to foresee the effect of statistics upon your insurance premium and carefully plan to reduce your insurance costs.

Pay attention to driving records, credit reports, and the automobiles you purchase.

Compare prices among insurance companies because one company may have a statistical difference in experience within an area from another causing an advantage in insurance rates.

Take the time to be diligent in purchasing insurance, just as you would with other purchases.

Enter your ZIP code into the FREE tool below to start comparing quotes now!

Free Auto Insurance Comparison

Enter your zip code below to view companies that have cheap auto insurance rates.

 Secured with SHA-256 Encryption

How much should I pay in auto insurance?

Shopping for a new auto insurance policy can be a daunting task to even the most seasoned of drivers. Most people do not understand what goes into a policy’s cost.

  • Your past driving record is the biggest factor in determining premium cost because all insurance companies operate off a model of risk.
  • When you are buying your insurance coverage, you have the option to pay it monthly, bi-monthly, every 6 months or even for the entire year in some cases.
  • Auto insurance can be a long and tedious process, but getting the right coverage is essential if you want to protect yourself financially.

While a policy may seem like a great deal, when compared to other policies of similar rates, it may not offer the same amount of coverage. That is why it is best to know what the average auto insurance policy costs before you start to shop.

Use our FREE online tool to start comparing rates!

Standard Average Cost of Insurance

According to the NAIC, or the National Association of Insurance Commissioners, the average rate that a person should expect to pay for auto insurance is $795 a year.

However, when looking at this number, you need to understand that it can vary greatly by state.

The state that has the highest cost for auto insurance is New York, with policy holders paying an average of $1,047.

While the average may seem low when you do comparison shopping, you need to understand why the average is the way it is.

The national average includes all cars in the United States – including luxury vehicles that exceed $100,000, as well as $2,000 commuter cars.

Why the Difference?

First of all, each state has its own laws on the minimum coverage that a person must carry in order to drive legally. Also, people carry different insurance policies based on what their vehicle is worth to them.

If a vehicle is only worth $2,000, most people will not carry full coverage insurance, but carry only the minimum that is required by law. That includes not carrying coverage if their car is totaled in a crash, or comprehensive and collision insurance.

How much is full coverage insurance for a 20-year-old? On average, someone that young will pay $5,333 in annual premiums. The amount you pay will vary based on your age.

Your past driving record is the biggest factor in determining premium cost because all insurance companies operate off a model of risk. The higher risk you are, the higher premium that you will pay.

Since all drivers are different, this also is a big factor in the average cost of insurance. If you have received tickets or had an accident recently, try to talk with local law enforcement first to reduce the number of points you have. This will lower your premium greatly if you can succeed.

Finally, costs vary greatly in each state depending on the region that you live in. If you live near a big city that has a high crime rate, dense traffic and a large number of vandalism cases, then you are going to pay a higher premium than others.

If you live in a small farm town with no problems whatsoever, you are going to enjoy lower average insurance rates.

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Enter your zip code below to view companies that have cheap auto insurance rates.

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Starting the Process

Before you even start to look for insurance providers online, you need to determine what type of insurance you need.

Do you want to cover your vehicle if it gets totaled or needs serious work, or do you just want to cover the liability portion if you were involved in an accident?

If you are currently financing or leasing your vehicle, you will likely need to purchase comprehensive and collision insurance to take care of your vehicle since most lenders will require this.

Once you have determined the type of insurance you want, go online and start looking around at all the insurance companies that you can find.

There are a lot of companies available, so it may be efficient to find a site that compares multiple insurers.

This will save you a lot of time in the process because you won’t have to fill out your information at 10 different sites just to get a quote.

Selecting Your Coverage

After you have found a site to get a quote, you need to select the type of coverage that you would like to have on your policy.

Many companies will try to help you by having many packages already pre-selected for you, which range from minimum coverage to the most comprehensive coverage.

While these packages are a great starting point, in order to be a smart consumer, you need to look into what these packages offer.

These following features can greatly change the average price of car insurance. Here are some things to look for in a policy:

  • Deductibles – If you don’t mind paying later, you can save a lot of money in the short term. The bigger deductible, or the amount you pay when you make a claim, the lower your insurance rates.
  • Maximum Coverage Amount – When you are purchasing liability, comprehensive or collision insurance, you will need to specify how much you want that policy to cover. Liability is required to drive, but the other two are optional.
  • Medical Benefits – This is a solid option for your insurance policy because you get a certain amount of money for medical bills, no matter who was at fault for the accident. It covers a variety of medical and hospital bills and adds very little to your monthly premium.
  • Uninsured/Underinsured Coverage – You may be a great driver, but not everyone on the road is like you. That means you may get in an accident with someone who doesn’t have insurance or they don’t have enough insurance; this coverage protects you against this.
  • Rental Car and Roadside Assistance – If you are going to need extensive work on your vehicle, this may be a good option to have. They give you a rental car when your car is being worked on.

Purchasing Your Policy

Now that you have gone through this rigorous process of researching policies, you will need to purchase your policy. This is not as straightforward as it may seem, as you now need to complete a good amount of paperwork in order to get your policy active.

Again, this is where the average cost of a policy can change.

When you are buying your insurance coverage, you have the option to pay it monthly, bi-monthly, every 6 months or even for the entire year in some cases.

Insurance companies encourage people to pay in full or in as little installments as possible, so they offer discounts again if you choose their favorable methods of payment.

Also, this is where you will enter your vehicle information, security protection for your vehicle and any driver courses that you may have completed recently. This can change the amount of your premium, so make sure to complete this important accurately.

Auto insurance can be a long and tedious process, but getting the right coverage is essential if you want to protect yourself financially. That is why it is important to understand why the average cost of insurance can vary so greatly.

Also, you will need to understand what coverage you may or may not need so that you are not paying for more insurance than you need. Whatever type of policy you decide to go with, be sure that you shop around first before making your final decision.

Use our tool below to compare multiple car insurance rates!

Free Auto Insurance Comparison

Enter your zip code below to view companies that have cheap auto insurance rates.

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What is the average auto insurance price range?

In order to find the average auto insurance price range, it is most helpful to compare rates in your local area. The average price for car insurance varies a lot from state to state. It even varies from zip code to zip code within a state.

  • In order to find the average auto insurance price range, it is mostly helpful to compare rates in your local area
  • Typically, very urban areas with a lot of traffic have higher rates than rural areas with sparser populations and fewer cars
  • Make sure to compare different companies to see the best price for the coverage that you need

You also must remember that averages are unlikely to represent the rate that will be offered to any one particular driver.

Be sure to compare auto insurance prices with a FREE quote comparison, such as the one at the top of this page! Just enter your ZIP code to get started.

Typically, insurers charge more for customers who are considered riskier or more expensive to cover. They charge less for coverage when they believe an applicant has less of a chance of making large claims or takes actions to reduce an insurer’s cost.

For example, a young driver with a few accidents on his record will probably more expensive to insure than a middle-aged woman who has not had an accident for several years. If she also owns a home, she might be able to reduce her rates even more by bundling policies with one company.

However, it might be interesting compare some average U.S. rates for auto coverage, and different organizations have compiled these statistics.

It is more likely that these statistics are interesting to insurance companies and state regulators than individual consumers though.

Average U.S. Insurance Price Rates

These statistics were taken from a study that was performed by the National Association of Insurance Commissioners in 201. These numbers are for drivers with full coverage, and that means that their policy includes liability, comprehensive and collision coverage.

It was a very simple study that added up the total cost of these policies and divided the total by the total number if insured people.

  • Average U.S. rate in 2010: $291
  • Average District of Columbia rate in 2010: $1,128
  • Average Iowa rate in 2010: $547
  • Average North Dakota rate in 2010: $529

Note that average rates for New Jersey and D.C. are considerably over the national average, but rates for Iowa and North Dakota fall well below it.

Typically, very urban areas with a lot of traffic have higher rates than rural areas with sparser populations and fewer cars.

New Jersey and D.C. rank one and two in the nation for the average price of full coverage, but Iowa and North Dakota rank 49th and 50th.

New Jersey and D.C. are almost entirely urban, while Iowa and North Dakota have vast expanses of rural land. Of course, North Dakota and Iowa have some mid-sized cities too, and it would not be surprising that auto insurance rates are considerably higher inside of Bismark or Sioux City than the state averages.

It would also not be surprising to find that the average rate in rural areas falls below the state average.

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How To Find Your Best Rate For Auto Insurance Coverage

Again, these averages might not be relevant to any individual consumers. Comparing the prices that different companies offer each consumer for the same coverage might be more useful. Fortunately, this is very easy to do these days.

You can find online insurance quote systems that will tell you how much your coverage will cost from the comfort of your computer or even your smartphone.

Some of these systems are offered by individual insurers. Others can offer multiple quotes because they are independent of any one company.

The independent sites are pretty useful because they can deliver a handful of comparison quotes from multiple companies.

Alternatively, you might call a local insurance agent. These trained professionals should be able to offer you free price quotes. They can also offer you advice about the type and amount of coverage you should purchase.

Remember that not everybody purchases full coverage. On the other hand, some people purchase more types of coverage and higher than average amounts.

Free Auto Insurance Comparison

Enter your zip code below to view companies that have cheap auto insurance rates.

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Does it pay to comparison shop for auto insurance rates?

Some people never bother to shop around for auto insurance because they think that all companies are very similar.

The truth is that some companies do offer better prices for certain types of customers than others. This can be true if you have a clean driving history, or if you have had a few accidents.

For example, did you even know that insurers can consider your credit report when they determine how risky you are to cover? In addition, some of the top insurers in the country offer discounts for things like driving an eco-friendly car.

It might not seem like a credit report should have anything to do with driving, but insurers say that people with good credit tend to make fewer claims. They also contend that the type of people who purchase “green” cars tend to have fewer accidents.

Neither of these factors seems directly related to the safety of the car or the driver. They might not things that average consumer has taken into consideration, but a good car insurance agent should be aware of them.

Find The Best Rates For A Driver Like You

It might be interesting to compare average auto insurance rates for all drivers in the nation, but it really won’t tell you a lot about the rates that you should be paying.

Your rates depend upon many different things, and the only way to find the best coverage at the right price is to compare quotes from a variety of different companies that do business in your city or town.

Why not comparison shop today to see if you can save some money?

Enter your ZIP code into the FREE quote tool below to get started.

Average Monthly Car Insurance Cost Comparison

  • Each state has a minimum required amount of car insurance
  • There are a variety of factors that affect insurance rates
  • Certain situations require a larger amount of coverage

Figuring the average cost of car insurance is a complicated process because there are so many variables in figuring insurance rates.

Having a basic understanding of insurance will help in considering how much to pay for insurance.

Most purchasers of insurance understand that car insurance is required by law.

The laws that establish the necessity for insurance are established individually by state, so the cost of insurance also varies by state.

Even though an insurance company may provide insurance in several different states, the insurance company must file rate applications in each state based upon statistics and claims data derived from that particular state.

Be sure to always compare auto insurance the quick and easy way: Simply enter your ZIP code into the FREE tool located above to get started!

Factors that Affect Your Insurance Rates

  • Age – Ordinarily the older you are, the fewer possibilities of accidents you have
  • Gender – Statistically, young, unmarried males have more accidents than young, unmarried females
  • Marital status – Married people are less likely to have accidents than unmarried people
  • Number of years licensed – Experienced drivers are typically better drivers
  • Credit history – Your credit history can indicate the possibilities of property damage claims due to lack of income
  • Home ownership – If you own your own home, you are likely to be more stable and less careless in your driving
  • Occupation – Some occupations are riskier than others
  • Past driving history – Citations for driving under the influence are particularly flagged because these indicate habits that may lead to further accidents
  • Good student discount – If grades are Bs or better, the individual is less likely to have been distracted by extracurricular activities

When you tender an insurance application, it is sent to an underwriter who examines it for areas that may indicate unusual circumstances that might lead to an excess of claims. That means your average auto insurance rates may change because of age and gender or even an accident you had several years ago.

If nothing flags the underwriter’s interest, it is sorted into categories of people they insure and rated accordingly.

Routinely insurance companies order a copy of your driving record, your credit record, and, sometimes, they will send investigators out to determine how you live and your reputation in your community.

This type of report is usually only ordered if the underwriter spots discrepancies between your application and the other records that are found.

Vehicle Year, Make, and Model Can Affect Your Rates

Your application will give the year, make, and model of your automobile, as well as the coverage, desired.

The cost of the vehicle has some influence upon the rates you will be charged within certain parameters.

Purchasing a Lamborghini that has a base price of $400,000 or more can affect your insurance rates because experience with that type of vehicle is statistically rare, and the usual rating provisions are not applicable.

The insurance company’s experience statistically with a brand, model, and year of the automobile has the largest effect upon the cost of insurance.

The Coverage Limits that You Request

Every state has a required minimum amount of bodily injury coverage, property damage coverage, medical payments coverage, and uninsured/underinsured motorists coverage.

  • Bodily Injury Coverage – gives you protection in the event that you are legally liable for bodily injury damage to others
  • Property Damage Coverage – provides protection if you are legally liable for property damage to property owned by others
  • Medical Payments Coverage – pays for the medical expenses suffered by you and your passengers after an accident

Remember, these are the basic liability coverages required by law.

The reason for purchasing insurance is not only because of the law enacted within your state. Insurance protects you and your financial stability.

If each of us had to pay individually for automobile accidents, it could cause extreme financial distress.

Not many of us could produce liquid cash to pay a $150,000 hospital bill incurred because of an accident in which we are liable.

Therefore, as individuals, we cannot afford to accept the minimum protection required by law, even though it may cost less.

Are You Average?

In conclusion, a number of variables affect the cost of your automobile insurance.

Look at the average costs of car insurance in your state to determine if your premiums are reasonable, but you should request at least two insurance quotations using the same data.

Just as families and cars vary, so do insurance rates. It is possible to foresee the effect of statistics upon your insurance premium and carefully plan to reduce your insurance costs.

Pay attention to driving records, credit reports, and the automobiles you purchase.

Compare prices among insurance companies because one company may have a statistical difference in experience within an area from another causing an advantage in insurance rates.

Take the time to be diligent in purchasing insurance, just as you would with other purchases.

Enter your ZIP code into the FREE tool below to start comparing quotes now!