Why Is Car Insurance So Expensive in Texas? (2024)
The average annual car insurance premium in Texas is $2,672, which is almost 13% higher than the U.S. average of $2,329.
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Written byElizabeth Rivelli
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Elizabeth Rivelli
5+ years writing insurance and personal finance topics
Auto, home, health, and life insurance expertise
Elizabeth has extensive insurance industry experience, having written for Insureon, Rate Retriever, and Insurify. She’s also finance and insurance editor for Car and Driver.
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Edited byKatie Powers
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Licensed auto and home insurance agent
3+ years experience in insurance and personal finance editing
Katie uses her knowledge and expertise as a licensed property and casualty agent in Massachusetts to help readers understand the complexities of insurance shopping.
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Updated September 17, 2024
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Texas has historically had some of the most expensive car insurance premiums in the U.S., and data shows that rates are continuing to increase. In December 2023, the average annual full-coverage premium was $2,364. By June 2024, the average annual premium increased to $2,672.
If you’re shopping for auto insurance, you might wonder why car insurance is so expensive in Texas. Here’s what you need to know about the factors that affect insurance premiums in the Lone Star State and how you can reduce your insurance costs.
Quick Facts
Texas car insurance rates increased by 40% between January 2021 and June 2024, Insurify data shows.
Age, location, driving record, and vehicle type can all affect your rate.
Texas car insurance rates will increase by about 23% during 2024, according to estimates from an Insurify report.[1]
How Texas car insurance rates have increased
The cost of car insurance in Texas has been rising consistently during the last several years. In January 2021, the average full-coverage rate was $1,612 per year. As of June 2024, the average full-coverage policy premium is $2,672, which is an increase of nearly 40%.
In the graph below, you can see how car insurance rates in Texas have increased over the years.
Average Annual Cost of Full-Coverage Car Insurance
Factors that affect your car insurance premium
Car insurance premiums in Texas will vary for every driver. Insurance companies consider a number of different rating factors to assess risk and determine prices, including your age, location, driving record, and vehicle details. To find the most affordable car insurance for your situation, it’s a good idea to compare quotes from several different insurance companies.
Learn more about a few of the most notable factors that can affect your Texas car insurance premium below.
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Age
Your age will affect how much you pay for auto coverage.
Teenagers pay the most expensive car insurance rates in Texas on average because they’re high-risk drivers. Data shows that drivers between the ages of 16 and 19 are more likely to have accidents than any other age group.[2] Once drivers reach their mid-20s, car insurance rates start to decrease with age for people who maintain a clean driving record. This trend continues until drivers reach age 70, after which senior drivers may face slight rate increases.
Below, you can see the average cost of liability insurance and full-coverage car insurance in Texas for drivers in different age brackets.
Age ▲▼ | Average Quote: Liability Only ▲▼ | Average Quote: Full Coverage ▲▼ |
|---|---|---|
| Teens | $203 | $426 |
| 20–29 | $149 | $313 |
| 30–39 | $113 | $238 |
| 40–49 | $101 | $212 |
| 50–59 | $90 | $189 |
| 60–69 | $85 | $178 |
| 70+ | $91 | $192 |
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers. Actual quotes may vary based on the policy buyer's unique driver profile.
Location
Where you live in Texas, down to your ZIP code, can affect car insurance costs significantly due to location-based factors like population density, average car repair costs, severe weather risks, medical expenses, and car theft rates. For example, drivers might pay lower premiums in ZIP codes with less crime.[3]
The largest cities also tend to have the highest rates. Houston is the most expensive Texas city for car insurance, followed by Beaumont, Dallas, and Austin, according to Insurify data. A few of the cheapest cities for car insurance in Texas include El Paso, Lubbock, and Fort Worth, which have slightly lower populations.
Below, you can find the average monthly car insurance rates for drivers in different Texas cities.
City ▲▼ | Average Quote: Liability Only ▲▼ | Average Quote: Full Coverage ▲▼ |
|---|---|---|
| Abilene | $92 | $212 |
| Amarillo | $106 | $249 |
| Arlington | $127 | $255 |
| Austin | $129 | $243 |
| Beaumont | $140 | $273 |
| Brownsville | $111 | $226 |
| Corpus Christi | $124 | $228 |
| Dallas | $135 | $284 |
| Denton | $115 | $256 |
| El Paso | $93 | $215 |
| Fort Worth | $121 | $245 |
| Galveston | $126 | $243 |
| Garland | $134 | $261 |
| Grand Prairie | $132 | $280 |
| Houston | $170 | $324 |
| Huntsville | $107 | $244 |
| Irving | $132 | $270 |
| Killeen | $106 | $211 |
| Laredo | $103 | $225 |
| Lubbock | $106 | $234 |
| McAllen | $118 | $241 |
| Mesquite | $130 | $280 |
| Midland | $100 | $241 |
| Odessa | $106 | $267 |
| Plano | $125 | $244 |
| San Antonio | $123 | $245 |
| San Marcos | $114 | $246 |
Disclaimer: Table data sourced from real-time quotes from Insurify's 50-plus partner insurance providers and quote estimates from Quadrant Information Services. Actual quotes may vary based on the policy buyer's unique driver profile.
Driving record
Insurance companies pay close attention to driving history when calculating premiums. Texas drivers with a clean record usually pay the lowest rates for car insurance because they pose less of a risk to insurers. People with accidents, speeding tickets, and other traffic violations demonstrate a greater risk to their auto insurers and pay higher premiums.
Make and model of your car
The type of vehicle you drive will influence your car insurance premium. New cars, luxury cars, and sports cars have higher values and repair costs and tend to cost more to insure. Used cars and older models that have already depreciated typically have lower insurance premiums. Many insurance companies offer savings when you insure a car that has anti-lock brakes, an anti-theft system, and other safety features.
The Ford F-150 is one of the most popular vehicles in Texas.[4] On average, it costs $185 per month to insure a Ford F-Series truck with full-coverage insurance in the U.S.
Some of the cheapest vehicles to insure in the U.S. include the Subaru Forester, Subaru Outback, Honda Odyssey, and Dodge Grand Caravan, with average monthly rates ranging between $147 and $158. To compare, some of the most expensive cars to insure are the Infiniti Q50, Dodge Charger, and Dodge Challenger, which have average monthly premiums ranging between $273 and $296.
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How to lower your car insurance rate
Texas car insurance premiums are increasing, but you can take steps to reduce your insurance costs. Use these strategies to help lower your car insurance premium:
Choose an insurer that offers discounts. Most Texas insurance companies offer car insurance discounts that can help you save money on auto insurance. Every insurer offers different discounts, but you can often find discounts for getting good grades in school, having no prior insurance claims, taking a defensive driving course, insuring multiple cars, and signing up for automatic payments.
Bundle your policies. You can sometimes save a significant amount on insurance when you bundle two or more insurance products from the same company. For instance, if you purchase car insurance with home insurance or renters insurance, you could earn a discount on one or both premiums.
Select higher deductibles. Some car insurance policies, like collision insurance, require a deductible that you pay out of pocket when you file insurance claims. Choosing a higher deductible will lower your insurance premium.
Shop around and compare rates. Car insurance companies charge different rates, even for the same type and amount of auto coverage. Comparing personalized quotes from several insurers is the best way to find the most affordable policy for your situation.
Why car insurance is so expensive FAQs
While Texas has high average car insurance rates, the amount you’ll pay depends on a number of factors. Here’s some additional information about the cost of car insurance in Texas that can be helpful as you shop for an insurance policy.
How much will auto insurance prices rise this year?
Texas car insurance premiums are projected to increase by 23% in 2024, based on Insurify data. The state average premium for full-coverage policies in January 2024 was $2,405. In June 2024, the average premium increased to $2,672 per year.
Why does car insurance cost so much?
Car insurance can be expensive in Texas for various reasons, including the number of claims filed, the cost of auto repairs in the state, and inflation. Additionally, each driver poses a certain amount of risk to their insurer. Drivers who pose the most risk pay higher rates than low-risk drivers.
Does car insurance ever get cheaper?
Car insurance typically gets cheaper for Texas drivers over time. Young drivers — including teens and drivers younger than 25 — pay the highest rates because they lack driving experience. Premiums tend to decrease steadily after that. You might also be able to reduce your premium with discounts or bundles.
Does credit score affect car insurance?
In Texas, insurance companies can use credit-based insurance scores to determine premiums. Drivers with good credit histories usually pay lower rates than drivers with poor credit histories.
Methodology
Insurify data scientists analyzed more than 90 million quotes served to car insurance applicants in Insurify’s proprietary database to calculate the premium averages displayed on this page. These premiums are real quotes that come directly from Insurify’s 50+ partner insurance companies in all 50 states and Washington, D.C. Quote averages represent the median price for a quote across the given coverage level, driver subset, and geographic area.
Unless otherwise specified, quoted rates reflect the average cost for drivers between 20 and 70 years old with a clean driving record and average or better credit (a credit score of 600 or higher).
Liability-only premium averages correspond to policies with the following coverage limits:
- Bodily injury limits between state-minimum rates and $50,000 per person, $100,000 per accident
- Property damage limits between $10,000 and $50,000
- No additional coverage
- Comprehensive coverage with a $1,000 deductible
- Collision coverage with a $1,000 deductible
Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Services’ database of auto insurance rates.
Sources
- Insurify. "New Report: Insurify Projects 22% Increase in Car Insurance Costs After 15% Spike in First Half of 2024."
- Centers for Disease Control and Prevention. "Teen Drivers."
- Insurance Information Institute. "What determines the price of an auto insurance policy?."
- J.D. Power. "Most Popular Vehicles Sold By State."
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Elizabeth Rivelli
Elizabeth Rivelli is a freelance writer covering insurance and personal finance. She has extensive knowledge of various insurance lines, including property and casualty, health, and life insurance. Her byline has been featured in dozens of publications, including Investopedia, Forbes, Bankrate, NextAdvisor, and Insurance.com.
Licensed auto and home insurance agent
3+ years experience in insurance and personal finance editing
Katie uses her knowledge and expertise as a licensed property and casualty agent in Massachusetts to help readers understand the complexities of insurance shopping.
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