The average cost of auto insurance in the United States is around $1,300 a year, or about $110 a month. However, that number is the average cost across the entire country, meaning it takes into account rates in expensive states like Michigan and California along with rates in cheaper states like South Dakota and Missouri.
Auto insurance rates are mainly based on:
• Age: Younger drivers under the age of 25 pay the highest rates, mainly because that age group gets into the largest number of accidents.
• Location: City drivers pay more than rural drivers due to the increased likelihood of having a claim (traffic jams, thefts, stop-and-go driving).
• Gender: Female drivers have lower rates than male drivers due to their better driving records.
• Driving history: Your own driving history plays a large role. If you’re a safe driver, you’ll have fairly low rates for your vehicle type and location.
• Type of vehicle: The more expensive the vehicle, the more it will cost to insure because the insurance company will have to pay more money to replace it. Pickup trucks are among the most expensive vehicles to insure because they are involved in more accidents and can cause more damage.
• Current insurance: Some insurance companies require you to have a current policy in force before they will insure you. If you don’t have prior insurance or have a long lapse in coverage, your options will be more limited and you’ll likely pay higher rates.
• Credit score: Credit scoring may not stick around as it’s being reviewed by state legislatures as an insurance rating tool at the time of this writing. But most states still use it as a rating factor, with better credit scores leading to lower rates.