Everything You Need to Know

The amount of money you pay each month for your car insurance depends on your state’s minimum insurance requirements. Your insurance company will consider other factors when calculating your rates, including marital status, age, and driving history.

How Much Does Car Insurance Cost?

According to The Zebra, an insurance policy costs, on average, $1483 a year. That’s $742 for a six-month policy or $124 in monthly payments. Each insurance company uses its own formula to calculate rates. That means, depending on what insurance company you purchase a policy from, you might pay higher rates than the national average, or you could end up paying lower rates. The Zebra breaks down the average cost by company as follows:

• Allstate – $1019 for a six-month policy/$170 a month
• Farmers – $788 for a six-month policy/$131 a month
• GEICO – $562 for a six-month policy/$94 a month
• Liberty Mutual – $863 for a six-month policy/$144 a month
• Nationwide – $541 for a six-month policy/$90 a month
• Progressive – $627 for a six-month policy/$104 a month
• State Farm – $646 for a six-month policy/$108 a month
• USAA – $636 for a six-month policy/$106 a month

Your premium may differ according to your level of coverage. The typical insurance policy, according to The Zebra, includes:

• Bodily injury liability coverage with a $50,000 limit
• Property damage liability coverage with a $100,000 limit
• A $500 deductible for collision coverage
• A $500 deductible for comprehensive coverage

If you still owe car payments to your auto lender or your leasing your vehicle, the leasing company may require you to carry gap insurance.

Car Insurance Cost by Level of Coverage

The Zebra ranks coverage levels by best, good, and minimum. If you have minimum insurance coverage, you only have the coverage that’s legally required by your state, and you don’t have comprehensive or collision coverage. A good level of coverage includes:

• Liability limits of 50/100/50
• $1000 deductible for collision and comprehensive coverage

The best level of car insurance coverage includes:

• Liability limits of 100/300/100
• $500 deductible for collision and comprehensive coverage

If you purchase a minimum liability insurance policy, here’s what you can expect to pay, on average, depending on what company you go with:

• Allstate – $378 for a six-month policy/$63 a month
• Farmers – $285 for a six-month policy/$47 a month
• GEICO – $232 for a six-month policy/$39 a month
• Liberty Mutual – $315 for a six-month policy/$53 a month
• Nationwide – $223 for a six-month policy/$37 a month
• Progressive – $258 for a six-month policy/$43 a month
• State Farm – $250 for a six-month policy/$42 a month
• USAA – $233 for a six-month policy/$39 a month

Here is what the leading companies charge, on average, for a “good” level of coverage:

• Allstate – $877 for a six-month policy/$146 a month
• Farmers – $687 for a six-month policy/$115 a month
• GEICO – $503 for a six-month policy/$84 a month
• Liberty Mutual – $767 for a six-month policy/$128 a month
• Nationwide – $479 for a six-month policy/$80 a month
• Progressive – $553 for a six-month policy/$92 a month
• State Farm – $595 for a six-month policy/$99 a month
• USAA – $555 for a six-month policy/$92 a month

These are the premiums that drivers can expect to pay, on average, for the best level of coverage:

• Allstate – $1070 for a six-month policy/$170 a month
• Farmers – $823 for a six-month policy/$137 a month
• GEICO – $611 for a six-month policy/$102 a month
• Liberty Mutual – $900 for a six-month policy/$150 a month
• Nationwide – $569 for a six-month policy/$95 a month
• Progressive – $673 for a six-month policy/$112 a month
• State Farm – $690 for a six-month policy/$115 a month
• USAA – $672 for a six-month policy/$112 a month

What Factors Affect Car Insurance Rates?

As NerdWallet points out, each insurance company uses a set of factors to calculate your car insurance rates. These factors help your provider make an educated guess about how likely you are to file a claim and how much of a risk you are to insure. Every company assigns its own value to different factors. For example, one company might raise your rates by 40 percent if you have poor credit, while another company might only charge you 10 percent more. If you haven’t filed a claim in several years, your provider might give you a 20 percent discount. Another claim-free driver might only get a 5 percent discount from their insurance company.

Your age plays a significant role in how much you pay for car insurance. According to traffic safety data, a driver’s age is a reliable factor for determining how risky they are behind the wheel. The Zebra lists the average car insurance cost for each age group as follows:

• Ages 16 to 19 – $2286 for a six-month policy/$381 a month
• Ages 20 to 29 – $943 for a six-month policy/$157 a month
• Ages 30 to 39 – $724 for a six-month policy/$121 a month
• Ages 40 to 49 – $697 for a six-month policy/$116 a month
• Ages 50 to 59 – $649 for a six-month policy/$108 a month
• Ages 60 to 69 – $658 for a six-month policy/$110 a month
• Ages 70 to 79 – $762 for a six-month policy/$127 a month
• Ages 80 to 85 – $882 for a six-month policy/$147 a month

Traffic violations, even minor ones, can also have a significant impact on your car insurance rates. According to The Zebra, an at-fault accident can cause your insurance premium to go up by at least $670 a year. If you’re in an accident or get a ticket, your provider may continue to raise your rates for the next three to five years.

Best Car Insurance Policies With a $500 Deductible

According to The Zebra, a $500 deductible is the auto insurance industry standard. On average, drivers can expect to pay just over $900, or around $150 a month, for a six-month policy that includes a $500 deductible. At around $90 a month, a six-month policy from USAA is the most affordable policy with a $500 deductible. Here’s what the leading companies charge on average for a six-month policy that includes a $500 deductible:

• Allstate – $1011
• Liberty Mutual – $863
• Farmers – $822
• Progressive – $809
• Nationwide – $714
• State Farm – $647
• GEICO – $602
• USAA – $545

Check this out if you need additional information, resources, or guidance on car insurance.

Sources:

What is the average cost of car insurance in America?

Best Car Insurance with a $500 Deductible

Average Car Insurance Costs in 2021

Standard Car Insurance Coverage

How to Get a Discount on Car Insurance: Everything You Need To Know

Car Insurance

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