Average Cost Of Car Insurance

By

Balance Pro Staff

updated on

December 15, 2023

Trying to figure out how much automobile insurance will cost you each month? With auto insurance policies, the costs can vary dramatically depending on your individual circumstances – from driving history, annual mileage, type of vehicle and more.

To help shed some light on this important topic, we’re taking a look at the average cost of auto insurance per month to give you an idea of what rates may be like in your area. Read on to get the facts about auto insurance pricing so that you can make an informed decision about which policy is right for your needs!

Overview of the Average Cost of Car Insurance in the US

In order to understand the average cost of auto insurance per month, it’s important to look at the overall landscape of car insurance in the United States.

The combined average premium per insured vehicle is $1,189 annually. Which bring the average cost of car insurance to be about $99 per month. Data via naic.org

However, this is only a general overview and does not take into account the many factors that can influence individual insurance rates. For example, the state you live in, your driving history, and the type of vehicle you own are all important factors in determining your specific insurance costs.

Factors That Affect Your Auto Insurance

One of the main factors that can affect your auto insurance premium is your age. Younger drivers, typically under the age of 25, are considered more high-risk and therefore may have higher insurance rates.

Gender also plays a role in determining premiums, with males generally being charged higher rates due to statistics showing they tend to be involved in more accidents than females.

Location is another important factor, as insurance rates are heavily influenced by the area you live in. Urban areas and states with higher levels of traffic tend to have higher insurance rates due to increased risk.

Driving history is perhaps the most significant factor in determining auto insurance premiums. A clean driving record with no accidents or tickets can result in significantly lower rates, while a history of accidents or speeding violations can lead to higher premiums.

Types of Coverage and How They Affect Your Monthly Auto Insurance Costs

The type of coverage you choose for your auto insurance policy can also have a major impact on the cost of your monthly premiums. The most basic and affordable type of coverage is liability insurance, which covers damages to another person's vehicle or property if you are at fault in an accident.

On the other hand, comprehensive and collision coverage provide additional protection for your own vehicle in case of accidents or damage from other sources such as natural disasters or theft. These types of coverage typically result in higher monthly premiums.

Another factor to consider is the deductible – the amount you pay out-of-pocket before your insurance kicks in. A higher deductible can lower your monthly premium, but it also means you will have to pay more in the event of an accident.

Ways to save Money on Car Insurance Premiums

If you’re looking to lower your monthly car insurance costs, there are a few strategies you can try. One option is to bundle multiple policies with the same insurance company, such as combining your auto and home insurance.

Additionally, shopping around and comparing quotes from different insurance providers can help you find the best rate for your specific circumstances. It’s also important to regularly review your coverage to ensure you are not paying for unnecessary add-ons or overpaying for your current policy.

Also, maintaining a good driving record and taking defensive driving courses can help lower your insurance premiums over time.

Common Discounts Offered by Auto Insurers

In addition to the strategies mentioned above, there are also various discounts that auto insurers offer to help lower monthly premiums for policyholders. These discounts are often based on factors such as a driver's age, driving history, and vehicle safety features.

One common discount offered by many insurance companies is a good student discount. Students who maintain high grades can often qualify for reduced rates since they are seen as more responsible and less likely to be involved in accidents.

Another popular discount is a safe driver discount. This is typically offered to individuals with clean driving records, meaning no accidents or traffic violations within a certain period of time.

Some insurance companies also offer discounts for drivers who have completed a defensive driving course. These courses provide additional training on safe driving techniques, which can lead to lower insurance premiums.

In addition, some insurers offer discounts for vehicles with certain safety features such as anti-lock brakes, airbags, and anti-theft devices. These features not only make your vehicle safer but can also help lower the risk of accidents and theft, resulting in potential savings on insurance premiums.

It’s important to note that not all insurance companies offer the same discounts, so it’s worth researching and comparing different providers to see which ones offer the best rates for your specific situation.

Strategies to Reduce Your Risk on the Road and Avoid Costly Premiums

While it may not directly affect your monthly insurance premium, practicing safe driving habits can help reduce the risk of accidents and ultimately save you money in the long run. Some ways to reduce your risk on the road include:

  • Obeying traffic laws and speed limits
  • Avoiding distractions while driving, such as texting or eating
  • Regularly maintaining your vehicle to ensure it is in good working condition
  • Avoiding driving under the influence of drugs or alcohol
  • Taking extra precautions while driving in hazardous weather conditions

By following these strategies, you can potentially avoid accidents and traffic violations that could result in higher insurance premiums.

Tips for Filing an Effective Auto Insurance Claim

In the event that you do have to file an auto insurance claim, it’s important to know what steps to take in order to make the process as smooth and effective as possible. Here are a few tips for filing an effective insurance claim:

  • Contact your insurance provider as soon as possible after an accident or incident.
  • Gather all necessary information, such as photos of the damage, police reports, and contact information for any other parties involved.
  • Be honest and accurate when providing details about the incident to your insurance company.
  • Keep track of all expenses related to the claim, such as rental car fees or medical bills.

By following these tips, you can ensure that your insurance claim is handled efficiently and correctly, potentially saving you time and money in the long run.

Conclusion

Auto insurance is a necessary expense for anyone who owns or drives a vehicle. However, there are ways to save money on premiums by taking advantage of discounts and practicing safe driving habits.

It’s also important to regularly review your coverage and make any necessary changes to ensure you are getting the best rate possible. In the event that you do need to make an insurance claim, following the proper steps can help ensure a smooth and effective process.

By staying informed and proactive, you can effectively manage your auto insurance costs and protect yourself on the road. 

So, it is always important to regularly review your policy and consider making changes if necessary. With these tips in mind, you can make informed decisions about your auto insurance and potentially save money in the long run. Stay safe and drive responsibly!

FAQs

Do I Need to Have Auto Insurance?

In most places, it is a legal requirement to have at least liability insurance for your vehicle. This helps protect you and others in the event of an accident.

How Often Should I Review My Auto Insurance Policy?

It’s recommended to review your policy every six months to ensure you have adequate coverage and are not overpaying for unnecessary add-ons.

Can I Switch Insurance Providers at Any Time?

Yes, you are free to switch insurance providers whenever you choose. Just be sure to research and compare quotes beforehand to ensure you are getting the best rate for your needs.  So, it is always important to regularly review your policy and consider making changes if necessary.

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This post is for informational uses only and is not legal, business, or tax advice. Please consult with an attorney, business advisor, or accountant with concepts and ideas referenced in this post. Balance Pro assumes no liability for actions taken in reliance upon the information contained in this article.

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