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UPDATED: Mar 13, 2020
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Car insurance is part of owning a car and the first question many people ask is how much is car insurance per month. The answer for how much is car insurance per month depends on a number off factors around your unique profile. Most consumers average between $1,000 to $2,000 annually for auto insurance however you need to remember that car insurance companies base premiums on risk and the higher the risk of an application the higher the rates.
What factors determine how much car insurance is?
There are hundreds of variables in the premium formula and the exact formula changes depending on which car insurance company you choose. Auto insurance companies employ thousands of employees who continually analyze data and look for correlations between behavior and risk. Any time a variable shows indication of adding risk to a driver filing a claim its reviewed. While there are literally hundreds of factors which collectively determine your final premiums, only a few play a significant role. The most important variables which help determine how much car insurance is per month are:
Your Driving Record
Your driving record is extremely important. Good drivers with a clean driving record clear of accidents and tickets pay much less for coverage than drivers who have been involved in a car accident or convicted of moving violations. Most car insurance companies look at the last 3 years history but there are a few who go back 5 years.
Type of Vehicle Insured
Car insurance for a corvette will always be higher than car insurance rates for a Toyota Prius. Vehicles are rated according to replacement value, safety ratings and other factors but generally the more expensive a car the higher the car insurance rates. Sports cars and exotic cars tend to have higher rates also.
Your Credit Score
How you pay your bills can affect your car insurance rates. Most car insurance companies pull a credit check as studies show drivers with poor credit have a higher risk of filing a claim. Some states have banned the use of credit scores for calculating auto insurance rates however there are still ways insurers can compensate for the higher risk. Before applying for auto insurance pull a copy of your credit report and try to fix any errors.
Car insurance for young drivers is substantially more. Once you surpass age 21 or 25 (depending on the insurer) and have at least 5 years of driving experience rats should go down.
Where you live
Car insurance rates vary depending on where you live. Drivers in Michigan can pay 100% more in premiums than drivers in Wyoming for example. The differences in premiums are due to many reasons including insurance laws, accident statistics and more.
Ultimately how much car insurance is per month will depending on your unique profile. The best way to secure the most affordable premiums is to perform a car insurance comparison search. Just like purchasing a new vehicle you need to spend the time, compare providers and choose coverage that offers the best plan for your family.
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