Car insurance is an essential part of owning a car in the United States. It protects you financially in the event of an accident or theft, but the cost of car insurance can vary significantly depending on several factors. In this blog post, we’ll provide an overview of the factors that affect the cost of car insurance in the USA and the average costs you can expect to pay per month.
Factors that Affect the Cost of Car Insurance
Several factors affect the cost of car insurance in the USA. These include:
- Age: Younger drivers typically pay higher premiums because they are considered to be more inexperienced and, therefore, more at risk for accidents.
- Driving record: Your driving history is one of the most significant factors that affect the cost of car insurance. If you have a history of accidents or traffic violations, you may pay more for car insurance.
- Location: The cost of car insurance can vary significantly depending on where you live. Some areas have higher rates of car theft and accidents, which can affect the cost of car insurance.
- Type of car: The type of car you drive can also affect your car insurance premiums. Cars that are more expensive to repair or replace, or that are more likely to be stolen, may have higher premiums.
- Coverage level: The amount of coverage you choose will also affect the cost of your car insurance. Policies with higher limits and additional coverage, such as comprehensive or collision coverage, typically have higher premiums.
Average Cost of Car Insurance in the USA
According to a report by ValuePenguin, the average cost of car insurance in the USA in 2021 was $1,674 per year, or approximately $139 per month. However, these figures can vary significantly depending on the factors mentioned above.
Age
Younger drivers typically pay higher premiums for car insurance. According to ValuePenguin, the average cost of car insurance for a 20-year-old driver in 2021 was $2,307 per year, while the average cost for a 40-year-old driver was $1,487 per year.
Driving Record
Your driving record is one of the most significant factors that affect the cost of car insurance. According to ValuePenguin, drivers with a history of accidents paid an average of $2,313 per year for car insurance in 2021, while drivers with a clean driving record paid an average of $1,397 per year.
Location
The cost of car insurance can vary significantly depending on where you live. According to ValuePenguin, the average cost of car insurance in 2021 was highest in Michigan ($2,112 per year) and lowest in Maine ($818 per year).
Type of Car
The type of car you drive can also affect your car insurance premiums. According to ValuePenguin, the average cost of car insurance for a 2021 Honda Civic was $1,626 per year, while the average cost for a 2021 Porsche 911 was $4,048 per year.
Coverage Level
The amount of coverage you choose will also affect the cost of your car insurance. Policies with higher limits and additional coverage, such as comprehensive or collision coverage, typically have higher premiums. According to ValuePenguin, the average cost of car insurance for a policy with $100,000 in bodily injury liability coverage and $50,000 in property damage liability coverage in 2021 was $1,556 per year, while the average cost for a policy with $500,000 in bodily injury liability coverage and $100,000 in property damage liability coverage was $2,263 per year.