Why Is My Car Insurance So High?

Your car insurance costs are in some ways a reflection of you, with the rates you pay based on factors such as your driving record and where you live. If your premiums seem too high or have shot up in recent months, there are a variety of possible reasons for it. Fortunately, there are also ways to bring those premiums back down.

Key Takeaways

What Determines How Much You Pay for Auto Insurance?

Though virtually every state requires drivers to carry a certain minimum amount of liability coverage, drivers have a great deal of flexibility in choosing the amounts and types of coverage on their auto policies. Americans paid an average of $1,633 in 2021, with projections for 2022 estimated at $1,706. The average American pays roughly $136 per month on car insurance, according to Insurify, the insurance comparison cost website.

But that’s just an average, of course, and the price you pay could be higher or lower, depending on many different factors, such as:

Even if you don’t think your auto insurance premiums are outrageously high, it can be worth shopping around every year or two to see if another insurer would charge you less for the same coverage.

What Can You Do to Lower Your Car Insurance Rates

Drive carefully. If you stay out of trouble on the road and don’t present your insurer with any serious claims, your rates may fall over time. Many insurers now use telematics technology to monitor drivers’ speed, acceleration, braking, and other factors and reward them with lower rates if they practice safe driving behaviors. If you’re comfortable with that, it could be worth checking out.

Raise your credit score. Because your credit score is often an important factor in setting your insurance rates, anything you can do to improve it could pay dividends. Investopedia has this advice on how to improve your credit score.

Take a class. Many car insurers offer lower rates if you attend an approved defensive driving course. You may also be required to take a course if you’re involved in a DUI or other offense.

Bundle your insurance policies. You may be eligible for a discount if you buy your auto, homeowners, or other policies from the same company.

Shop around. The car insurance industry is competitive, and companies are eager to add new customers. There are numerous websites where you can input your information and compare rates. If your premiums have gone up recently, it could be worth reaching out to your current insurance company or agent to find out why. If they want to keep your business, they may have some suggestions, such as other discounts you’re entitled to, for lowering your rates.