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Here’s the Average Cost of Auto Insurance — and How You Can Lower Yours

The number might surprise you.

Key points

  • The average driver aged 30 to 45 pays $1,638 a year for auto insurance.
  • Your premium rates will hinge on factors including where you live, your driving record, and the type of car you drive.
  • You can lower your costs by purchasing a less expensive car, being careful on the road, and bundling with a homeowners policy.

Owning a car can be an expensive prospect. Not only do you have to potentially tackle monthly auto loan payments, but you need to cover the cost of car insurance.

The average annual cost of auto insurance in the U.S. for drivers aged 30 to 45 is $1,638, according to Policygenius. But you may be looking at a very different number.

What determines your auto insurance rates?

There are different factors car insurance companies use to determine what to charge you. These include:

  • Where you live: If you live in a city with a higher crime rate, or one that’s densely populated, you might face a higher rate than a driver living in a quiet suburb.
  • Your driving record: If you’re a fairly new driver, or if you have a number of moving violations on your driving record, you might pay more for car insurance than someone with more experience and a clean record.
  • The type of car you drive: It stands to reason that it will cost more to repair or replace a $70,000 car than a $30,000 car, so the more expensive your vehicle is, the more you might pay for auto insurance.

How to lower the cost of auto insurance

Auto insurance can eat up a nice chunk of your income, so you may want to do what you can to lower your costs. And there are a few ways to go about that.

First, consider buying a less expensive vehicle to begin with. Not only will this keep your transportation costs down in general, but you’re likely to be quoted a lower rate for car insurance if your vehicle isn’t loaded with high-end features that might require more expensive repairs.

Secondly, drive carefully. Granted, in some cases, you can get into a car accident through no fault of your own. But you can make a point to not speed or weave in and out of traffic. If you’re caught doing these things and are ticketed for them, it could lead to more expensive premiums.

More: Check out our picks for best car insurance companies

Finally, if you own a home, look into bundling your auto insurance policy with your homeowners insurance policy. If you use the same company for both, you might get a discount that makes each policy less expensive.

That said, bundling won’t always be your cheapest option. So while it’s a good thing to look into, you’ll also want to contact different car insurance companies and shop around for rate quotes. This is a smart thing to do whether you’re applying for auto insurance for the first time, or whether you’ve had a policy in place for years and are looking to reduce your costs.

Be realistic about the cost of vehicle ownership

If you’re going to own a car, you need to have a good sense of what that entails financially. Not only must you account for the cost of your car payments and auto insurance premiums, but you’ll also need to factor in regular maintenance and repairs.

If you live in an area where it’s possible to get around without a car, you may want to consider doing so for as long as you can. The amount of savings you might reap could be huge. And that way, you can bank that cash so that if your circumstances change, you’re able to swing the cost of vehicle ownership more easily.

Our best car insurance companies for 2022

Ready to shop for car insurance? Whether you’re focused on price, claims handling, or customer service, we’ve researched insurers nationwide to provide our best-in-class picks for car insurance coverage. Read our free expert review today to get started.

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