Why Did Your Car Insurance Rates Go Up? (2025)
Individual and regional factors contribute to higher insurance rates. Nationally, Insurify projects a 22% increase in car insurance costs in 2024.
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Written byJulia Taliesin
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Julia Taliesin is an insurance content writer at Insurify. She began her career as a journalist, covering local government and business in Somerville, Mass.
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Edited byEvelyn Pimplaskar
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10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
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Reviewed byDaniel Roccato
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30+ years in financial services
Clinical Professor of Finance, University of San Diego
Dan is a well-recognized and widely quoted financial services expert, regularly appearing in a variety of national and local media as a subject matter expert.
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Table of contents
Numerous factors affect your car insurance rates, from your age and driving record to regional climate risk. Some may increase your premium, like adding a teen driver to your policy. Others may come as a surprise, like a rate increase on renewal because car theft rates rose in your neighborhood.
Understanding when and why your auto insurance rates might increase can empower you to plan for changes and shop around for the coverage you need. Here’s what to know about why your car insurance rates might have gone up and why they’re increasing across the nation.
Quick Facts
Getting a speeding ticket or causing an accident will lead to higher premiums for three years or longer.
Discounts, like ones for good students or bundling home and auto coverages, could help offset rising car insurance rates.
Car insurance rates are increasing the fastest in Minnesota, up 55% since last year, Insurify data shows.
Reasons why your car insurance rate increased
Several individual and local factors, like your driving record and your area’s claims rates, can increase your car insurance premium. Even before accounting for more regional or national factors, like severe storms or inflation, causing a fender bender or adding a driver to your policy can affect your rates.
Here are some common factors that can affect your premiums.
Received a speeding ticket or moving violation
Speeding, running a red light or stop sign, texting while driving, failing to signal, drunk driving, weaving, and tailgating are all moving violations. These are dangerous driving behaviors, and they often come with higher fines, stiffer penalties, and more significant insurance rate increases. Non-moving violations — like an expired registration or a parking ticket — generally don’t affect your premiums.
Got into an accident
If you cause an accident, your insurance rates will almost always increase. In some states, an at-fault incident may not affect your rates if the damage isn’t too costly. The rate increase will typically remain for three years, but this varies by state and insurer.[1]
Unfortunately, sometimes even car accidents you didn’t cause can raise your rates, though often not by as much as an at-fault accident. An increase can depend on your state and insurance company. For example, some states have no-fault car insurance laws, which means each driver involved in a crash files a claim to their insurer for injuries. Some insurance companies assign percentages of fault to determine damage awards.
Filed a claim
You may need to file a claim for something other than an accident, like theft, vandalism, fire, or weather-related damage. Whether this results in higher premiums depends on several factors, including your state, your insurance company, and what caused the damage. For example, comprehensive insurance covers damage from hitting a deer, and if you do that once, your insurer may raise your rates to reflect the risk of you filing a similar claim in the future.
Added a driver
Insurers recommend adding drivers to your policy if they drive your car regularly, whether they’re a roommate, significant other, child, or friend. Adding a low-risk driver, like a 34-year-old with a good driving record, will cause a much smaller increase than adding high-risk drivers, like new drivers or anyone with a history of traffic violations.[2]
Claims in your area have increased
Insurance companies set rates based on risk, and your location is a significant car insurance rating factor. For example, U.S. drivers in urban areas often pay more, given the higher rates of accidents, theft, and vandalism in their area. If claims in your area increase due to more theft, collisions, or even severe weather events, you could see increases in your premiums.
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How to get cheaper car insurance rates
You have many strategies available to lower your auto insurance premiums. When renewal time comes around, it’s a good idea to review your insurance coverage to make sure it matches your needs. Here are some ways you can save money on car insurance.
Compare car insurance quotes
Shopping around and comparing car insurance prices are the top two recommendations for lowering car insurance premiums, according to the Insurance Information Institute (Triple-I). Using a quote-comparison tool makes it easy to price multiple options for the coverage you need.
Be a safe driver
Your driving record affects your auto insurance premiums significantly. Safe driving habits — like wearing your seat belt, avoiding speeding and hard braking, and driving only when you’re rested and completely sober — can help reduce your risk of getting into an accident.
Maintain good credit
Actuarial studies show that someone’s credit history can indicate their likelihood of filing insurance claims, so many insurers review this when setting rates. Insurers don’t check your actual credit score but use your history to calculate a credit-based insurance score. Some states restrict or limit insurers from using any credit information when determining premiums.[3]
Seek out discounts
You can earn significant discounts for bundling policies, choosing usage-based insurance, installing safety features, insuring multiple cars, taking approved driver safety courses, and more.
Choose a “safer” vehicle
Cars with poor safety ratings and high repair or replacement costs are often more expensive to insure. The cheapest cars to insure right now are the Subaru Forester and Outback, according to Insurify data, and the Insurance Institute for Highway Safety (IIHS) named both a Top Safety Pick in 2023.
Raise your deductible
Increasing your deductible — the amount you pay for a claim before your coverage kicks in — will get you lower rates. Just make sure you have the cash to cover the higher out-of-pocket costs if you need to file a claim.
Reduce your coverage
If your car is worth less than 10 times the premium, paying for collision and comprehensive may not be cost-effective, according to Triple-I. But if you’re still financing or leasing your vehicle, your lender or leasing company may require you to have full-coverage car insurance.
Where car insurance rates are increasing the most
Insurify’s data science team predicts a total 22% increase in auto insurance costs in 2024, but rates are rising even faster in some states. Several factors contribute to this, from hailstorms in Missouri, Illinois, and Minnesota to hurricanes in North Carolina. Auto thefts also drive up premiums, and Missouri, California, and Illinois were among the top states for car thefts, according to the National Insurance Crime Bureau (NICB).
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Reasons why car insurance rates are increasing nationally
Intertwining economic factors have caused the national average cost of car insurance to rise. Severe weather events, more technologically complex vehicles, mechanic labor shortages, the high price of new cars, and other factors are all leading to more expensive claims for insurers.
The influence of each factor can vary based on your location, vehicle type, and more, so despite national increases, it’s worth shopping around to know you’re paying the best rate for your ideal coverage.
Climate change and severe weather
The number of weather events causing more than $1 billion in damage is increasing. From 2019 to 2023, the U.S. saw an average of 20.4 billion-dollar weather events per year — a significant increase from the 13.1 events annually from 2010 to 2019, according to data from the National Oceanic and Atmospheric Administration (NOAA).
Comprehensive car insurance covers damage from weather events, so while natural disasters historically affect home insurance costs more than auto premiums, auto insurance companies are starting to feel the squeeze. The increasingly frequent and extreme weather events bringing golf-ball-sized hail and catastrophic flooding to new areas of the country are leading to more comprehensive claims and expensive payouts.
Vehicles are more expensive to fix
Vehicle maintenance and repair costs increased by 38% in the last five years, according to the Bureau of Labor Statistics’ Consumer Price Index. The advanced technology that helps drivers avoid collisions — and related premium increases — is expensive to repair. These advanced driver-assistance systems (ADAS) can add as much as 37.6% to the total repair cost following an accident, according to AAA.[4]
As vehicles and technology become more complex, mechanic labor hours have increased by more than 40% per claim, according to CCC Intelligent Solutions. Even finding a mechanic to make the repairs can be challenging. A TechForce Foundation study found the U.S. is facing a shortage of more than 600,000 auto and collision technicians. In addition, electric vehicles cost more and take longer to fix than gas-powered cars, according to a report from CCC.
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Price of new cars has increased
New vehicle prices have increased dramatically in recent years, according to Kelley Blue Book (KBB). The average transaction price fluctuated around $48,000 in 2024 — up $11,000 from the $37,000 average before the COVID-19 pandemic. Vehicle age has also reached an all-time high of 12.6 years, according to S&P Global, meaning more drivers are keeping their vehicles longer.
Most insurers offer discounts for new cars since they’re safer and more reliable, but they’re also more expensive to insure, given the high replacement cost and complex repairs. Insurance is often much cheaper for older vehicles. For example, insuring a 2011–2012 Honda Civic averages $1,968 annually, while a 2023–2024 model averages $3,425 per year, according to Insurify data.
Car insurance rate increases FAQs
Many factors affect car insurance rates, and rising costs are a top concern for drivers. These insights could help you navigate this challenge.
Is it normal for car insurance to go up for no reason?
Your car insurance premium can increase based on economic or insurance industry changes that aren’t specifically related to your driving record. So if it feels like your premium increased for no reason — meaning you didn’t file a claim, add young drivers, or something similar — it may be due to larger factors, like inflation or regional claims rates.
Why did my car insurance go up after renewal?
Your car insurance might have increased after renewal if you got a speeding ticket or filed a claim. Or local factors like auto repair costs and theft rates may be influencing rates in your area. If you have a traffic violation, your insurance costs may decrease after three to five years of maintaining a clean record. Regional factors can also shift. For example, if vehicle theft rates in your area decrease, your rates may get a little cheaper.
Does your credit score affect car insurance rates?
Insurance companies don’t look at or consider your credit score. But in some states, they do consider your credit history. They use your credit history to calculate a credit-based insurance score, which many use to help assess drivers’ risk levels. Drivers with excellent credit pay about 17% less than average, while drivers with poor credit pay about 21% more for car insurance, according to Insurify data.
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Sources
- Insurance Information Institute (Triple-I). "Do auto insurance premiums go up after a claim?."
- GEICO. "When to Add a Driver."
- Experian. "Which States Restrict the Use of Credit Scores in Determining Insurance Rates?."
- AAA. "Cost of Advanced Driver Assistance Systems (ADAS) Repairs."
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Julia TaliesinData Journalist
Julia Taliesin is a data journalist at Insurify. She began her career as a journalist, covering local government and business in Somerville, Mass. She reported multiple investigative stories about municipal finances and budget allocation, building development and inspection, and personnel. When the pandemic began she became a de facto public health reporter, writing daily and weekly reports using available data to quickly communicate rates of infection and city response.
She's worked for print and digital outlets, writing everything from quick-hit breaking news to long-form community features. More recently, Julia managed content strategy at a startup creating a social platform for licensed nurses, overseeing a team of nurse freelancers and editing interview transcripts and news articles for publication.
She holds a Bachelor's degree in communications from Simmons University, with a focus in journalism. Outside of work, Julia enjoys working on crafting projects, learning about homesteading, and singing in cover bands.
10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
Featured in
30+ years in financial services
Clinical Professor of Finance, University of San Diego
Dan is a well-recognized and widely quoted financial services expert, regularly appearing in a variety of national and local media as a subject matter expert.