Average Cost of Car Insurance Reflecting What All Consumers’ Spend

Average cost of car insurance reflects what all consumers actually spend on insurance, meaning those with the cheapest rates are pooled with those with the most expensive premiums, and those who buy minimum coverage are included with those who buy extensive protection. If you decide to compare the rates you’ve gathered with average costs, it may be more useful to look at the average cost within your state. Comparing your rates with the nationwide average, or with the average price from a different state, could be misleading due to varying risk factors. Insurance rates are determined by looking at several risk factors, which include (but are not limited to) where you live, your age and your claims record. Factors affecting rates for group health insurance policies include the health and ages of members within the group.

According to data from the National Association of Insurance Commissioners (NAIC), the average car insurance cost car insurance in the U.S. was $795 in 2007. When compared to average costs by state, however, it’s clear that location can make a big difference.

For example:
* New York: $1,047
* Florida: $1,043
* Pennsylvania: $820
* Texas: $808
* California: $800

The average car insurance price assumes that all insured vehicles include liability coverage, the minimum auto insurance requirement in most states, but does not reflect the total of liability as well as collision and comprehensive coverage — because not all auto policies include all three coverage types. The NAIC also reports that states with greater premiums tend to be highly urban — with higher wages and price levels — and possess a higher traffic density.

One of the most important factors is getting the average cost of car insurance for each month. Some parameters are related to the car’s model and value. The driving history is another factor of great importance because each driver has a different driving style. For example a more passive aggressive driver will always pay a lot more because he represents a hazard (and in the same time a risk) for the company. On the other hand, a “safer” driver will most definitely pay less, and even get discounts for the limited number of claims that comes with safe driving. Therefore, keep in mind that a good insurance company will treat each customer as an individual and estimate rates for different people. This will make the average cost of car insurance differ from one person with another.