What is average car insurance cost per month? Quick Answer
- In 2022, the average car insurance cost per month in the United States was $105. This rate varies based on factors like driver age, location, and vehicle type.
Summary
- Monthly car insurance premiums averaged $105 in 2022.
- Premiums continue to increase annually.
- Costly auto technology and inflation affect premium increases.
It’s not your imagination. Car insurance rates are increasing each year. According to the National Association of Insurance Commissioners (NAIC), combined average premiums increased by 5.75% in 2022.
While that looks insignificant, that slight increase can make a big difference, especially if you own multiple vehicles or have a spotty driving record. Here is what to know about the average monthly car insurance payment and what to expect for the future.
What Affects the Average Auto Insurance Cost Per Month?
Car insurance companies consider these factors when assessing auto insurance costs:
- Credit history
- Age
- Location
- Driving record
- Gender
- Marital status
- Vehicle make and model
However, your state’s laws may prevent some of these factors from setting your rate. For example, California, Hawaii, Massachusetts, and Michigan don’t allow car insurance companies to consider credit history when setting rates.
Many of these items are beyond your control. You can’t change your age, and moving to a state with cheaper car insurance isn’t reasonable for most people. Generally, the best way to get the lowest rates is to decrease risk by keeping your driving record clean and avoiding accidents.
Initial Trends in Average Monthly Car Insurance Payment
But even when accounting for factors within one's control, monthly premiums have undoubtedly increased in the past few years.
Starting in 2017, the average monthly cost for auto insurance was $94.8. The latest data from 2022 shows the average monthly premium is $105–a big jump from $99.1 in 2021.
The trend continues in 2024. Motor vehicle insurance increased 22% through April of this year, and the average yearly car insurance premium was $1,280 in 2023.
Recent Fluctuations and Pandemic Impact
Insurance companies started increasing premiums after the pandemic in 2020. Supply costs and inflation made it more expensive to pay claims. Technological advances, like motion sensors or electric vehicles, made even minor repairs costly. The result was higher claims, which companies passed on to their consumers.
Projections for Future Insurance Costs
Current projections reveal the average auto insurance cost per month will continue increasing. While the situation is not entirely within your control, you can reduce your premium by:
- Shopping around for the best insurance quote
- Compare insurance costs before buying a car
- Raise the deductible on your policies
- Stick with the same company for all your insurance needs, e.g., car and rental insurance
- Maintain good credit
- Look into discounts like low mileage, good driver or anti-theft device.
Consumers should stay informed about what could affect their insurance costs. As car technologies improve and economic conditions change, insurance prices may vary. Start by regularly checking your insurance policies and seeing if you can find a better deal with another company.
