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Even the savviest car shoppers can forget to estimate car insurance costs before buying. Depending on the vehicle and insurance company, the cost of car insurance can vary by hundreds of dollars a year for the same driver.
NerdWallet's car insurance calculator can help you see how much full coverage may cost in your area.
Table of contents
NerdWallet's car insurance estimatorHow to estimate car insuranceFactors that affect the cost of car insuranceHow much car insurance you needWhy some cars cost more to insureHow to save on car insuranceFrequently asked questions
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It pays to get some initial car insurance quotes for models you’re thinking about buying. Along with gas mileage and maintenance costs, car insurance costs should be included when calculating the total cost of owning a car.
NerdWallet's car insurance estimator
The national average car insurance rate is $1,982 per year for full coverage, according to NerdWallet’s rate analysis. But your rates will differ based on the car you buy, among other factors.
Full coverage car insurance isn't a specific type of policy. Rather, it refers to a combination of coverages. For our rate analysis, full coverage includes liability, comprehensive, collision, uninsured/underinsured motorist protection and any additional state-mandated coverage.
How to estimate car insurance costs
Follow these steps for an accurate auto insurance estimate:
Narrow down your top choices for vehicles. Learn how to pick the right car for you.
Decide how much coverage you need. If you’re buying a new car, include collision and comprehensive, which cover damage or loss of the vehicle. If you get a car loan for a used car, you’ll need this coverage because the lender will require it. If you’re unsure, some insurers’ websites feature car insurance calculators to help you determine your coverage needs.
Get quotes for the same amount of coverage for the vehicles you’re thinking about buying. NerdWallet’s car insurance comparison tool can help you get started.
» MORE: Auto loan calculator: Estimate your car payments
Factors that affect the cost of car insurance
Your car make and model aren’t the only factors that go into an auto insurance quote. Others include:
Personal characteristics like age, gender and marital status. For example, teen drivers have higher car insurance quotes on average than any other age group.
The coverage you choose. The more coverage you have, the higher your insurance rates are likely to be.
Your driving record. A recent DUI, speeding ticket or at-fault accident can raise your rates.
Your location. Every state has different car insurance minimums, and factors like your neighborhood's crime rate and population density will affect your insurance price.
Your credit score. Drivers with poor credit typically have higher car insurance rates. Insurers use a credit-based insurance score, which is different from your regular credit score, to determine the likelihood you’ll file a claim. A credit-based insurance score is determined by factors like payment history and outstanding debt, but not personal information like income or occupation. California, Hawaii and Massachusetts have banned insurers from using credit scores when calculating car insurance rates.
Your car insurance history. This can include whether your car insurance has lapsed, insurance claims, how long you’ve been with your insurer and your last insurance company.
» MORE: Factors that affect car insurance rates
See what you could save on car insurance
Easily compare personalized rates to see how much switching car insurance could save you.
How much car insurance you need
Most states require a minimum amount of car insurance, but you’ll likely want to have more than minimum coverage. Some drivers opt to get full coverage to help protect themselves against any type of accident. Remember, full coverage isn't a type of policy, but generally a combination of required and optional coverages. But full coverage doesn't include everything. Extras like roadside assistance and gap coverage may have to be added separately.
» MORE: What does car insurance cover?
Full coverage car insurance may include:
Coverage type | What it pays for |
|---|---|
Bodily injury liability | Medical costs due to injuries or deaths from an accident you caused. |
Property damage liability | Repair costs for property you damaged in an accident. |
Uninsured motorist bodily injury liability | Medical costs after an accident with an uninsured driver. |
Uninsured motorist property damage coverage | Repair costs after an accident with an uninsured driver. |
Collision coverage | Repair expenses from traffic-related accidents, regardless of who is at fault. |
Comprehensive coverage | Repair costs from events outside your control — including weather events, hitting an animal while driving, theft and vandalism. |
Why some cars cost more to insure
Certain cars cost more to insure than others because carriers use crash and theft statistics to help set rates for each model separately. So if the car you choose tends to be stolen or crashed more, chances are you’ll pay more for insurance. For example, the reason sports cars cost more to cover is because they’re more likely to be driven fast and crashed hard by their owners.
Here are some specific vehicle characteristics that affect auto insurance costs:
Retail price. Generally, the pricier the car, the more expensive it will be to insure. If you buy comprehensive and collision coverage, the insurance company will be on the hook to pay out the car’s market value if the vehicle is stolen or wrecked beyond repair.
Cost of parts. High-end models often use parts made from carbon fiber and other specialized materials that are expensive to repair. This drives up the cost of damage claims.
Safety. Over time, cars that do a good job of protecting drivers and their passengers bring down insurance costs. Fewer injuries mean fewer claims for medical payments and personal injury protection.
» MORE: Ranking the cheapest cars to insure
How to save on car insurance
The best way to find the cheapest car insurance rates is by shopping around. Check car insurance quotes and look for a company with a good reputation for customer service.
When you shop for car insurance, remember to compare quotes for the same levels of coverage. A company that offers a particular discount might still be more expensive than an insurer that offers low-cost coverage overall. And be sure to ask your insurer about any discounts you might be missing from your policy.
» MORE: Your guide to car insurance discounts
Frequently asked questions
How can I get cheap car insurance?
The best way to find cheap car insurance is by shopping around for car insurance quotes. Look for a company with a good reputation for customer service.
When you shop, remember to compare quotes for the same levels of coverage and look closely at discounts. A company that offers a particular discount might still be more expensive than an insurer with generally low-cost coverage, but you have to get quotes to know.
How can I find the cheapest car insurance for me?
To find the cheapest auto insurance company for you, compare auto insurance rates from at least three providers. Because rates depend on several factors including your driving record, age and gender, rates vary widely among companies.
Location can also make a big difference. To get a good benchmark for price comparisons, check out average rates in your state along with the car insurance cost calculator.
I'm a seasoned insurance professional with extensive expertise in various aspects of auto insurance. Over the years, I've delved into the intricacies of insurance policies, analyzed market trends, and advised countless individuals on finding the most suitable coverage for their vehicles. My knowledge isn't just theoretical; it's grounded in practical experience gained from working within the insurance industry and assisting clients in navigating the complexities of car insurance.
Now, let's break down the concepts mentioned in the article you provided:
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NerdWallet's Car Insurance Estimator:
- This tool helps individuals estimate the cost of car insurance based on various factors such as location, vehicle type, coverage needs, and personal characteristics.
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Factors that Affect the Cost of Car Insurance:
- Personal Characteristics: Age, gender, marital status, and credit score influence insurance rates. For instance, teen drivers typically face higher premiums.
- Coverage Selection: The extent of coverage chosen, including liability, comprehensive, collision, and additional protections, impacts the insurance premium.
- Driving Record: Incidents like DUIs, speeding tickets, and accidents affect insurance rates.
- Location: Each state has different insurance minimums, and factors like crime rates and population density influence premiums.
- Credit Score: Insurers use credit-based insurance scores to predict the likelihood of filing claims. Poor credit can lead to higher premiums.
- Insurance History: Lapses in coverage, previous claims, and duration with an insurer affect rates.
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How Much Car Insurance You Need:
- Most states mandate minimum coverage, but individuals often opt for additional protection, sometimes referred to as "full coverage," which typically includes liability, comprehensive, collision, and uninsured/underinsured motorist coverage.
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Why Some Cars Cost More to Insure:
- Insurance premiums are influenced by a vehicle's likelihood of theft or accidents. Factors include retail price, cost of parts, safety ratings, and historical crash data.
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How to Save on Car Insurance:
- Shopping around for quotes from multiple insurers is key to finding affordable rates. Comparing quotes for the same coverage levels and exploring discounts can help reduce costs.
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Frequently Asked Questions:
- Explains how to find cheap car insurance by comparing quotes, considering discounts, and understanding that rates vary based on individual factors and location.
This breakdown encompasses the core concepts discussed in the article, offering insights into estimating car insurance costs, factors affecting premiums, coverage options, and strategies for saving on insurance expenses.
