Why is Car Insurance so Expensive?

The cost of car insurance is steadily increasing nationwide and if you are wondering why your car insurance is so expensive. Then this article is just for you, keep reading to find out more information on car insurance rates.

Why is Car Insurance so Expensive?

There are several reasons and factors why your car insurance is expensive. So there isn’t a direct answer to the question. Some factors may be noticeable, like a speeding ticket, while others may be less obvious, like your ZIP code or marital status.

Understanding the reason why your car insurance is expensive will equip you with the information you need when searching for car insurance with lower costs.

Why is Car Insurance so Expensive?

There are several likely reasons why car insurance is expensive. It could be your state of residence, age, or gender, below are some listed:

Personal Factors

there are some personal reasons why your car insurance may be quite expensive. Some of them are listed below:


a personal factor like your age can influence the price of your car insurance. Young drivers from the age of 18-25 will usually get insurance at a very high rate this is because they are inexperienced.

Inexperienced drivers from research are more likely to get into fatal accidents than older drivers with experience.

Due to the above, insurance companies will usually charge high rates when the driver is young and inexperienced.


a personal factor like your gender can influence the price of your car insurance this is because men are charged higher than women.

Men are charged higher than women because men are more likely to engage in rough and risky driving behaviors.

However, you can escape this expensive insurance by gender if you reside in certain states as Insurers in states like California, Hawaii, Massachusetts, Michigan, Pennsylvania, North Carolina, and Montana are not allowed to charge insurance based on gender.

Marital Status:

a personal factor like your marital status can influence the price of your car insurance as most big car insurance companies give lower insurance rates to married drivers.

Drivers who are single, separated, widowed, or divorced pay a lot more to insure their cars this is because married drivers have good credit scores making them pay less.


a personal factor like your educational status can influence the price of your car insurance this is because insurers believe highly educated people tend to have fewer claims making them less expensive to insure.

This practice is gradually fading away but it is still in existence in most states.


another personal factor that can greatly increase the price of your insurance is your location. Rates increase significantly by Zip code and neighborhood.

If your location is prone to severe weather attacks such as hail or flooding, this can greatly increase the price of your insurance.

Living in a rural or urban area is also a great contributor to your insurance price, especially for those living in an urban area as the risk of accidents, theft, and vandalism is greater in the city.


another personal factor to your insurance price is the work you do, drivers with certain low jobs will have to pay higher insurance prices because they are most likely to file more insurance claims.

This practice is gradually fading away and has been considered banned in some states.

Credit history:

your credit score can affect the price you pay for car insurance; this is because it can be used to determine your potential risk.

Car insurance companies believe that those with bad credit are more prone to filing claims and so they pay more. Those with good credits pay less, however, this practice is prohibited in states like California, Massachusetts, Hawaii, and Michigan.

Home Ownership:

homeowners tend to pay less on their car insurance, those who do not own a home have to pay more to insure their cars.

Homeowners whose homes are insured by the auto insurance company for their cars also get to have a massive discount on car insurance.

Driving Factors

Some driving factors influence the price you pay to insure your car which includes your driving records and others. some of them are listed below:

Driving record:

Your record as a driver will be put into consideration before your car is insured. If you have a bad driving record which includes traffic tickets, rules violations, and at-fault accidents then you are more likely to pay high insurance rates.

If your driving record is clean and void of violations and at-fault accidents. You can pay for insurance for your car with a small amount of money.

Some car insurance companies are more forgiving than others. You can find a company with cheap insurance rates for violators and drivers with bad driving records.


Low mileage drivers get cheap car insurance because they spend less time on the road and thus have fewer opportunities for an accident.

Car Storage:

Drivers who have a garage pay lower insurance rates this is because cars parked in garages are safer from theft, vandalism, and other accidents than cars left on the streets.

Driving Experience: drivers with long-term driving experience get car insurance at a cheaper rate than those who are inexperienced. Inexperienced drivers are more accident-prone and so have more expensive car insurance prices.

Vehicle Factors

Your choice of vehicle as a driver can influence your car insurance price. Below are some of the factors surrounding your vehicle that can influence your insurance price.

Car Model:

the car insurance you pay on cars varies from car to car. Your insurance company may have experienced drivers who have your exact kind of car and use the knowledge of your car type to charge you for insurance.

Insurance companies consider the risks involved in a car such as car thieves, repair costs, and others. Speeding cars and even electric cars also attract very high insurance prices.

Popular cars like the Honda CR-V, Jeep Wrangler Sport, and Subaru Crosstrek are the cheapest cars to insure, unlike expensive cars.

Trim Level:

Cars with extra features such as audio, cameras, and lane sensors cost more to repair and thus cost more to insure.

Vehicles with higher trim levels raise the bar to their car insurance prices.

Safety Features:

Cars with safety features cost more to repair and they are quite expensive to replace if there is an accident. These kinds of cars have high prices for car insurance.

Car Insurance Choice

The choice you make when you are car insurance shopping can also increase the price you pay to insure your car, below are some examples.

Insurance company:

the car insurance company you choose can affect the price you pay this is because some car insurance companies are more expensive than others.

Insurance Lapses:

if you fail to pay your insurance bill, your bill will increase as a result if not denied. To be on the safe side, choose the coverage you can afford and be consistent in paying your bills.

Insurance Coverage Selected:

the insurance coverage you choose determines the price you pay for insurance. The price for full coverage differs from the price for collision coverage. Do your research and choose the coverage you can afford.

Insurance deductible amount:

the coverage you choose will have an amount of deductible attached to it. Ensure you choose a deductible you can afford to pay if there is an accident. If otherwise, you may be sued when you cannot afford it.


If you are loyal to your insurance company, you may be given a discount. However, this practice is being banned in some states.

Economic Factors

The economy also has a role to play in the price of insurance policies, below are some examples.

Rising Costs:

Inflation in the country also affects insurance companies this is because insurance companies pay for repair costs, medical bills, and other bills which have skyrocketed as a result of rising costs.

Increase In Claims:

Claims gotten by insurance companies are continually on the rise, thus insurance companies have a lot to pay for which influences their prices.


How do I Save on Car Insurance?

Even with the rising cost of car insurance, if you use the following tips, you will be able to save:

  • Drive carefully to avoid speeding tickets
  • Have a good credit score
  • Choose your vehicles carefully
  • Consider choosing a higher deductible if you can afford it
  • Ask for discounts

For How Long Will Violations Stay on My Driving Record?

Serious violations that lead to at-fault accidents can stay for as long as five or ten years depending on the state you reside in while small or moderate violations can stay for two to five years depending on the state.

Car insurance companies will look at your driving record for the last three to five years before giving you a price.

What States Have Expensive Car Insurance?

The states with expensive car insurance are Michigan, Florida, Louisiana, New York, Massachusetts and Connecticut.

What States have the Cheapest Car Insurance?

The states with the cheapest car insurance are Maine, North Dakota, Idaho, and Ohio.

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