Yes, you read that right—53. We know shopping around and managing auto insurance can get pretty daunting. With numerous car insurance plans left and right, how do you know which one is the best for you?
Insurance policies will vary depending on conditions like your location, marital status, credit score, and more. So it takes quite a bit of research to become a virtuoso in this field. As the experts in car insurance, CheapInsurance.com has done the work for you.
Let’s first cover some ground on the basics of car insurance and then dive into 53 insightful car insurance facts that can steer you toward the right decision.
Why Is It Important to Have Car Insurance?
Car insurance safeguards drivers by providing financial protection. In the event your vehicle is damaged in an accident or another situation (fire, theft, vandalism, etc.), you can receive compensation under your insurance plan. Most states legally require car insurance.
What Are the 4 Components of Car Insurance?
As we noted earlier, car insurance policies will vary depending on your circumstances. But overall, the most basic policies typically cover four areas:
- Bodily injury coverage: If you are involved in a serious accident in which you are at fault, you may be liable for a large sum of money. Bodily injury covers injuries sustained by the other driver involved in the accident.
- Property damage liability: This covers the damage to the other driver’s car or property. It also covers any damage to buildings and structures that your car hits.
- Collision coverage: Collision coverage pays for your car damage resulting from an accident. Accidents can involve a collision with another car or object (potholes, trees, etc.) or a rollover accident.
- Comprehensive coverage: This coverage reimburses you for loss due to theft or damage caused by something other than a collision with another car or object. Fires, falling objects, earthquakes, and riots are some of the covered events.
Become an Expert: 53 Car Insurance Facts
Let’s dive further into some nitty-gritty areas with 53 interesting facts about car insurance. To help you navigate through the myriad of insurance facts, we’ve broken up the information into the following categories:
- Premiums and Payment Plans
- Car Type
- Car Insurance Claims and Policies
- Married vs. Single Drivers
- Credit Ratings
- Traffic Accidents, Thefts, and Fatalities
Whether you want to switch insurance and/or find a more affordable option, we hope these facts help you become an expert in this field.
1. The first car insurance policy was issued in 1897.
2. The dawn of the internet in the mid-1990s boosted the number of car insurance providers. It also fueled a decrease in premiums due to the ease of comparing quotes.
3. Self-driving cars may prompt companies to explore innovative insurance solutions.
Premiums and Payment Plans
4. Auto insurance premiums are on average $1,674 per year or $140 a month.
5. Auto insurance makes up roughly 2.44% of the average household income.
6. Your deductible amount is inversely relative to your premium amount. Paying a lower deductible will increase your premium since you’re viewed as a higher risk. Paying a higher deductible will decrease your premium because you’re viewed as a lower risk.
7. Half of your insurance premium goes toward administrative expenses, not claims.
8. Car insurance premiums used to be priced evenly, then they began assessing risk which lowered premiums for good drivers.
9. The type of car you drive affects your premiums. More specifically, insurance companies look at the likelihood of theft, cost of repairs, engine size, safety records, and the potential damage your car can impose on another vehicle.
10. Buying a new car will generally increase your insurance premiums. However, if your new car carries safety features and upgrades (anti-theft systems, anti-lock brakes, etc.), you may be able to qualify for lower premiums.
11. The Toyota Sienna Minivan has one of the lowest yearly premiums compared to all other cars.
12. The Honda Fit EV will add free collision insurance to the entire lease period.
13. The average insurance cost for medium sedans in 2020 was $1,245. This was a slight dip from 2019, where the cost was $1,251.
Car Insurance Claims and Policies
14. Bodily injury claims are the most expensive insurance claim, averaging $15,862 per loss, followed by:
- Property damage at $3,630
- Collision claims at $3,247
- Comprehensive claims at $1,659
15. Collision and comprehensive coverage are required if you have a lienholder.
16. State Farm is the largest policy writer for auto insurance followed by Berkshire Hathaway Inc. and Progressive Corp.
17. Of all auto insurance policies, 22% are written for high-risk drivers.
Married vs. Single Drivers
18. Full coverage car insurance costs an average of $123 less each year for married couples than for single drivers.
19. Married drivers have fewer accidents and therefore, get the married discount due to lower risk.
20. Married couples spend on average $1,381 each year on car insurance.
21. The average single driver spends $1,484 a year for car insurance or $742 for a standard 6-month policy.
22. Widowers on average pay $1,437 a year for car insurance. Statistically, a widower is more likely to get into an accident and file a claim than a married driver.
23. Female drivers tend to pay less for car insurance than male drivers. This might be due to data that suggests:
- Men are more likely to engage in riskier driving behaviors like speeding, driving under the influence, and not wearing seatbelts.
- Men drive more miles than women.
24. There are insurance policies focused on female-only drivers. They offer roadside assistance, coverage for stolen purses left in the vehicle, and other perks.
25. Seven states do not allow using gender as a pricing factor in determining one’s auto insurance rate. They are:
- North Carolina
26. Women are 37 to 73% more susceptible to injury in vehicle accidents. There are two reasons for this:
- Women are more often hit in an accident.
- Women are more likely to drive lighter and smaller cars than men.
27. The average car insurance rate for teen drivers is roughly $6,800 each year (when they are on their own policy—not under their parents’). The reason for this high rate (compared to the national average rate of $1,674), is due to teens’ inexperience and tendency to engage in distracted and reckless driving (speeding, texting while driving, etc.).
28. According to the CDC, those between the ages 16 to 19 are three times more likely than drivers ages 20 and up to get into a fatal car crash.
29. The high insurance rates young drivers tend to pay begin to decrease at the age of 25. You typically receive the best rates in your 40s to 60s. As you reach your 70s, insurance rates begin to rise.
30. The top five states for the highest car insurance rates are:
- Louisiana: $2,839
- Michigan: $2,112
- Florida: $2,082
- California: $1,966
- Missouri: $1,895
31. The top five states for the cheapest car insurance rates are:
- Maine: $858
- New Hampshire: $885
- Wisconsin: $938
- Idaho: $985
- Ohio: $992
32. Individual US states like Connecticut have larger insurance markets than entire countries such as Brazil and Sweden.
33. Mississippi has the highest rate of uninsured motorists.
34. 21 states have mandatory coverage for uninsured motorists.
35. If you live in a “no-fault” state, you will pay higher premiums for personal injury because of fraud.
36. Texas and California have had the greatest number of traffic fatalities during the past few years.
37. The state of California has the most auto thefts.
38. People in urban locations can be susceptible to higher insurance rates than rural areas.
39. States with a history of severe weather are more likely to have higher car insurance rates than states with milder climates.
40. A city or county may have local laws regarding barefoot driving.
41. Credit rating can affect your premiums as much as a past ticket or accident. A decreased credit score can increase your premium by $1,351.
42. Many people receive negative credit reports against them for failing to cancel a policy when switching carriers.
43. Shopping around often is not the best option if you have poor credit, you would do better establishing a good payment history with your current carrier.
Traffic Accidents, Thefts, and Fatalities
44. Rear-end crashes are the most prevalent of auto accidents.
45. A speeding ticket can increase your premium by $355.
46. Although the percentage of injuries from auto accidents rose 1.2% in the last year, traffic fatalities have steadily declined.
47. In fatal crashes, failing to stay in a designated lane or running off the road cause the most deaths.
48. Studies are showing states with texting bans reduce ER visits by 4 percent.
49. The leading cause of death for ages 15 to 20 is motor vehicle collisions.
50. In 2019, 45% of teenage drivers who died in a car accident were not wearing a seatbelt.
51. Two-door vehicles have the most collision claims.
52. Your driving record can predict how long you will live. Research shows people with no tickets or accidents live longer on average regardless of the type of death.
53. In an accident, the car’s registered owner is the responsible party, not necessarily the driver. You should transfer your ownership titles immediately upon selling your vehicle.
Get Your Free Quote Today
We hope these interesting facts about car insurance offer some insight and direction as you steer through your car insurance journey. If not, well, you’re now armed with 53 different conversation starters for those awkward break-the-ice moments at events.
If you’re in the market for car insurance, don’t hesitate to sign up for your free quote from Cheap insurance today. Specializing in high-quality insurance plans, our team can help you find one that best suits your needs and budget.