New York – April 4, 2022 – Bankrate’s annual Real Cost of Car Insurance report has been released, showing the current state of car insurance across the country in 2022.
- Nationally, drivers spend an average of $1,771/year on car insurance, or 2.57% of average household income.
- The percentage of income spent on car insurance varies widely across metro areas, with drivers in Miami spending 5.58% ($3,508) of their income on car insurance each year, while drivers in Boston spend only 1.35% ($1,328) of their income on auto insurance. Assurance.
- Adding a teenage driver to a policy may be the costliest life event for auto insurance consumers, resulting in a $2,081 increase in the average auto insurance premium (bringing the national average premium for these drivers at $3,852).
|Ranking of actual costs*||Metropolitan Statistical Area (MSA)||% of household income spent on car insurance||Average premium|
|The cheapest metros||1||Boston||1.35%||$1,328|
|The most expensive metros||23||Detroit||4.38%||$2,872|
- Bankrate used current data from Quadrant Information Services to understand the average cost of car insurance for each US state and metropolitan statistical area. Each slot was assigned a “true cost rank”? – a score between one and 50 for the States and one and 25 for the most populated metropolitan areas. The lower the ranking, the lower the percentage of total income that drivers spend on car insurance premiums.
“Household transportation budgets are already under significant financial strain amid the highest inflation in 40 years, and almost every facet of driving is becoming more expensive,” says Sarah Foster, Bankrate Analyst. “Prices for used and new vehicles increased by 41.2% and 12.4% respectively compared to a year ago. Tire prices rose 15.4%, auto parts and equipment rose 11.3%, and Americans paid their highest ever prices at the gas pump in March. Moving inflation tends to stay moving:
Insurance companies are already responding by raising their premiums, emphasizing the importance of shopping around if you live in one of these more expensive metropolitan areas.
Bankrate’s True Cost of Auto Insurance report describes the impact of everyday life events on auto insurance premiums in the 50 states and 25 largest metropolitan areas. While adding a teenage driver to a policy is notably the costliest life event for drivers (adding $2,081 to the average annual premium), other life events such as getting a speeding ticket and declining credit scores can also add up quickly:
|life event||Average additional cost in the United States||Cost added toPremium in Most expensive metro||Cost added toPremium in Cheapest metro|
|Credit score goes from “good” to “bad”||$1,231||Detroit – $4,300||Seattle – $58**|
|Gets a speeding ticket||$367||Los Angeles- $883||San Antonio- $152|
|Involved in a car accident||$750||San Francisco -$1,432||New York – $513|
|Has a breakdown of auto insurance coverage||$178||Miami- $575||Charlotte – $124**|
|Convicted of drunken driving||$1,650||Detroit – $4,746||San Antonio – $913|
|Adds teen driver to policy||$2,081||Detroit – $3,739||Portland- $1,827|
**These locations are in states that do not prohibit auto insurance companies from changing premiums due to these life events. Drivers in California metropolitan areas will not experience any premium increases for credit score decreases or coverage interruptions due to state laws.
“The usual financial wisdom holds true, even when it comes to car insurance,” adds Foster. “Providers often reserve their most competitive rates for consumers with high credit ratings and strong borrowing histories. Drivers will also want to shop around and compare different fares to ensure they are getting the best deal on the market.
Bankrate uses Quadrant Information Services to analyze 2022 rates for all ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted by population density in each geographic region. Rates quoted are based on a 40 year old male and female with a clean driving record, good credit and the following full coverage limits:
- Civil liability of $100,000 in bodily injury per person
- Civil liability of $300,000 in bodily injury per accident
- Civil liability of $50,000 in property damage per accident
- $100,000 uninsured motorist bodily injury per person
- $300,000 uninsured motorist bodily injury per accident
- $500 collision deductible
- $500 aggregate deductible
Our basic profile drivers own a 2020 Toyota Camry, commute five days a week, and drive 12,000 miles a year.
These are sampling rates and should only be used for comparison purposes.