Why Is My Car Insurance So High? 10 Reasons (+ How to Save)

There are a number of factors that impact your car insurance rates, including your coverage choices, deductible, driving record, age, vehicle make and model, driving frequency, credit score, neighborhood, insurance company, and more. While this might sound complicated, looking into discounts and comparing rates from multiple car insurance companies can help lower your insurance premium. 

Why is car insurance so expensive? 

Car insurance rates depend on many factors, from your age and driving record to the type of car you drive. Even factors you cannot fully control — like your neighborhood and inflation — can impact your rates. 

#1 You have high coverage levels

This is a “good” reason for your car insurance to be expensive, as it means you have more financial protection in case of an accident. The more coverage you have, the less likely you will have to pay a lot of money out-of-pocket when a collision occurs.

If you have a full-coverage insurance policy (which includes liability insurance, collision coverage and comprehensive coverage), you will pay more than you would for minimum liability car insurance — but you’ll also have more financial protection.

Full-coverage policies with higher liability limits can be pricey, but shopping around can help you find the cheapest car insurance rates. Check out what the following list of insurance companies are quoting real Jerry customers for full-coverage policies:

Insurance Company	Avg Monthly Quote
Grange	$122
Freedom	$204
Aspire Advantage	$226
Safeco	$246
Bluefire	$247
Mercury	$262
Progressive	$265
Metlife	$273
Anchor General	$285
First Acceptance	$300

Last Updated Mar 24, 2025

A minimum liability insurance policy is the cheapest insurance you can buy — but while you might be paying less money for your monthly premium, you may find yourself financially vulnerable if you’re involved in an accident.

Each state has a different minimum liability insurance policy. Indiana’s, for instance, has limits of 25/50/25, or $25,000 of bodily injury liability per person, $50,000 of bodily injury liability per accident and $25,000 of property damage liability per accident.

It’s not hard to imagine quickly exceeding that $25,000 property damage liability for a major accident, especially if you happen to hit a newer vehicle. All of the expenses following a car accident, including car repairs and medical expenses, quickly add up. If you don’t have enough coverage to pay for the other driver’s expenses, as well as your own, you could find yourself in a lot of debt.

That said, there’s a trade off, as raising your policy limits or purchasing additional coverage — like gap insurance, personal injury protection (PIP) and roadside assistance — will increase your premium.

#2 You have a low deductible

Your deductible, or the amount you agree to pay out of pocket before your car insurance company pays to cover a claim, also impacts your insurance rates. A higher deductible on your coverage will often give you lower rates, while a lower deductible may increase your monthly rates. 

If you set a higher deductible, like $1,000, your car insurance company will lower your rates a bit because you’re taking on more of the cost if you file a claim.

#3 You have a poor driving record

Traffic violations tell car insurance providers that you’re a risky driver, and that tag comes with higher premiums. 

Our experts analyzed thousands of car insurance policies quoted to real Jerry users to determine how various violations can impact your average monthly premium:  

Driving Violation	Increase in State Min. Coverage	Increase in Full Coverage Cost
No Violation	Baseline	Baseline
Careless Driving	19%	34%
Cell Phone	43%	80%
Driving on Sus. License	9%	23%
DUI	2%	16%
Failure to Obey Traffic Sign	11%	18%
Illegal Turn	25%	36%
Improper Passing	2%	31%
Reckless Driving	195%	187%
Speeding over 15	12%	21%
Speeding under 15	36%	1%
Suspension	7%	19%
Wrong Way/Wrong Lane	40%	74%

#4 You don’t have much driving experience

Young or new drivers are statistically more likely to be involved in accidents than drivers with more experience, so they’re considered high-risk and pay more for insurance. 

Car insurance rates tend to go down once you reach the age of 25 and then increase again once you reach your mid-70s. 

» Learn more: How to find cheap car insurance for new drivers

#5 You drive an expensive vehicle

Pricier cars are more expensive to insure because they will cost your insurer more to repair or replace after a claim. So if you own a luxury vehicle or sports car, you’ll pay higher insurance rates.

Classic cars tend to be an exception to this rule — they’re valuable but require specialized classic car coverage insurance that usually costs less.

New cars are generally more expensive to insure than older vehicles due to their high replacement or repair costs. Vehicles with up-to-date safety features that have done well on the Insurance Institute for Highway Safety might have lower insurance premiums (and will keep you safer), but it’s also possible that the safety features cost a lot to repair and replace, leading to higher premiums. 

#6 You drive a lot

The more you drive, the higher your risk — and the more you can expect to pay for your insurance coverage. 

Every minute you spend on the road increases your chance of being involved in an accident or claimable incident, so your mileage plays a role in the price of your premium. 

Alternatively, if you rarely drive, you might qualify for a low-mileage discount because you are less likely to file a claim.

» Learn more: The best low-mileage car insurance companies

#7 You live in a high-risk neighborhood 

Location is another big factor in your insurance rates. Living in an area deemed higher risk by insurers will usually mean pricier insurance, and those rates can vary widely even within the same city. 

Urban areas tend to have higher auto insurance rates, as do ZIP codes with higher vehicle theft rates. And while rural areas usually have cheaper rates, places that are prone to severe weather, like flooding or tornadoes, also tend to have higher auto insurance rates.

#8 You have a low credit score

There is a statistical correlation between low credit scores and insurance claims, so most auto insurance companies use something called a “credit-based insurance score” to set car insurance premiums. On average, drivers with good credit scores pay lower premiums than drivers with poor credit scores.

Keep in mind that some states, like California, Massachusetts, and Hawaii, ban the use of credit scores when setting auto insurance premiums.

#9 You have a policy with an expensive insurance company 

Sometimes, it’s just about the company you’re with. Insurance companies use different methods to calculate their premiums, meaning that some might be more affordable for your vehicle and driver profile than others. Check out recent quotes Jerry customers have gotten:

Date of Policy	Insurance Company	City, State	Monthly Quote
March 23, 2025	Anchor General	Adelanto, CA	$287
March 23, 2025	Root	Toccoa, GA	$225
March 23, 2025	Progressive	Daly City, CA	$536
March 23, 2025	Progressive	Lake Charles, LA	$422
March 23, 2025	Progressive	Benbrook, TX	$79
March 23, 2025	National General	Dixon, CA	$202
March 23, 2025	Aspire Advantage	Hesperia, CA	$80
March 22, 2025	The General	Florence, SC	$180
March 22, 2025	Progressive	Dillon, CO	$114
March 22, 2025	The General	Spokane, WA	$159

Last Updated Mar 24, 2025

It’s always a good idea to compare quotes from multiple companies every six months to make sure you’re getting a good deal. If you find that you’re paying too much for car insurance, switching companies may help you find the best rate. 

#10 Inflation

So, what’s going on with car insurance prices? Inflation. It impacts everything and has caused industry-wide insurance rate hikes over the past few years. Along with the prices for both new and used cars, the cost of parts and labor has also gone up — which impacts your premium since insurance companies have to pay out more for claims. 

» Learn more: Best insurance companies for most drivers

How to lower my car insurance

Don’t worry, your car insurance rates are not set in stone. There are a few things you can do to lower your premium. 

Look for discounts 

Car insurance discounts are a great way to reduce your premium. While many insurance companies automatically apply discounts to your policy, it never hurts to ask if you are eligible for further savings. Keep in mind that different insurers offer different discounts, and some may not be available with every company or in every state. 

Here are some of the most popular discounts:

• Good driver or safe driver discount: Keep your record free of car accidents and claims for at least three years.
• Bundling discount: Buy two or more insurance products with the same company (like homeowners and auto).
• Good student discount: If you have a younger driver on your plan, maintain a 3.0 average in full-time studies.
• Pay-in-full discount: Pay your premium annually instead of monthly.
• Multi-vehicle discount: Insure two or more vehicles with the same insurance company.
• Accident forgiveness: This is sometimes available as an add-on for purchase, but it might also be applied as an automatic discount. Accident forgiveness prevents a rate increase after your first accident. 

Practice safe driving habits

Maintaining a good driving record is a great way to save money on car insurance. Not only does it keep you safe, but it also keeps your premiums low. 

Avoid risky behaviors, such as speeding, distracted driving and driving under the influence. These habits will help you avoid pricey tickets and a bad record as a risky driver. 

Look for a new insurance company

The best way to get lower rates on car insurance is by comparing quotes from multiple car insurance companies. If you see a better rate, simply make the switch to a new company. 

With the Jerry app, you can easily compare car insurance quotes from dozens of providers. The app will show you rates based on your driver profile, including your driving record and vehicle information. You can also adjust your car insurance coverage levels directly in the app. Simply download the Jerry app, enter your information, and start reviewing auto policies from the best car insurance companies.