The countrywide average auto insurance expenditure rose 1.0 percent to $1,070.47 in 2019 from $1,059.41 in 2018 according to the National Association of Insurance Commissioners. In 2019 (the latest data available), the average expenditure was highest in Louisiana ($1,557.22) followed by Michigan ($1,495.94), and New York ($1,445.30).
To calculate average expenditures, the National Association of Insurance Commissioners (NAIC) assumes that all insured vehicles carry liability coverage but not necessarily collision or comprehensive coverage. The average expenditure measures what consumers spend for insurance on each vehicle. It does not equal the sum of liability, collision and comprehensive expenditures because not all policyholders purchase all three coverages. The average expenditure measures what consumers actually spend for insurance.
AAA’s 2021 Your Driving Costs study found that the average cost to own and operate a 2021 model vehicle was $9,666 in 2021 when the vehicle is driven 15,000 miles per year. The average full-coverage insurance cost for medium sedans was $1,403, compared with $1,296 for a medium SUV. The average insurance cost for all vehicles, including pickups and hybrid and electric vehicles, was $1,342. AAA insurance cost estimates are based on a full coverage policy for a driver who is under 65 years of age, has more than six years of driving experience, has had no accidents, and lives in a suburban/urban location.
79 percent of insured drivers purchase comprehensive coverage in addition to liability insurance, and 75 percent buy collision coverage, based on a Triple-I analysis of 2019 NAIC data.
The coverage is for a policy with $100,000/$300,000 personal liability, $25,000 medical, $100,000 property and $25,000/$50,000 uninsured/underinsured motorist coverage, with a $500 deductible for collision and comprehensive claims. These figures are not comparable with the National Association of Insurance Commissioners’ auto expenditures data, below.
Average Expenditures For Auto Insurance, 2010-2019
The tables below show estimated average expenditures for private passenger automobile insurance by state from 2015 to 2019 and provide approximate measures of the relative cost of automobile insurance to consumers in each state. To calculate average expenditures, the National Association of Insurance Commissioners (NAIC) assumes that all insured vehicles carry liability coverage but not necessarily collision or comprehensive coverage. The average expenditure measures what consumers spend for insurance.
Expenditures are affected by the coverages purchased as well as other factors. The NAIC does not account for policyholder classifications, vehicle characteristics or the amount of deductibles selected by the policyholder, differences in state auto and tort laws, rate filing laws, traffic conditions and other demographic variables, all of which can significantly affect the cost of coverage. The NAIC notes that three variables—urban population, miles driven per number of highway miles, and disposable income per capita—are correlated with the state auto insurance premiums. It also notes that high-premium states tend to also be highly urban, with higher wage and price levels, and greater traffic density. Many other factors can also affect auto insurance prices.
Top 10 Most Expensive And Least Expensive States For Auto Insurance, 2019 (1)
Rank
Most expensive states
Average expenditure
Rank
Least expensive states
Average expenditure
1
Louisiana
$1,557.22
1
Maine
$696.37
2
Michigan
1,495.94
2
North Dakota
703.73
3
New York
1,445.30
3
Iowa
714.86
4
District of Columbia
1,440.58
4
Idaho
738.10
5
Florida
1,414.17
5
North Carolina
741.70
6
New Jersey
1,395.53
6
South Dakota
745.33
7
Rhode Island
1,382.64
7
Wisconsin
767.42
8
Nevada
1,292.52
8
Wyoming
776.22
9
Delaware
1,289.93
9
Indiana
777.05
10
Georgia
1,259.49
10
Vermont
785.37
(1) Based on average automobile insurance expenditures.
Average Expenditures For Auto Insurance By State, 2015-2019
2019
2018
Average expenditure
State
Liability
Collision
Compre-
hensive
Average
expenditure
Rank (1)
Average
expenditure
Rank (1)
Average
expenditure
percent change
2018-2019
2017
2016
2015
Alabama
$527.20
$390.19
$180.11
$932.14
29
$906.36
31
2.8%
$857.56
$791.39
$739.93
Alaska
584.90
401.87
155.11
991.09
21
965.45
23
2.7
931.43
911.37
915.59
Arizona
662.55
327.86
208.38
1,063.93
18
1,049.00
17
1.4
997.60
926.76
877.11
Arkansas
484.37
372.65
240.54
897.92
32
899.11
32
-0.1
849.37
781.00
742.44
California
627.77
495.18
96.53
1,051.79
19
1,033.97
19
1.7
965.05
898.84
840.66
Colorado
704.82
332.26
298.01
1,174.87
14
1,133.14
15
3.7
1,052.61
945.59
869.84
Connecticut
799.45
412.78
134.01
1,237.55
11
1,217.25
11
1.7
1,168.79
1,108.67
1,074.96
Delaware
897.87
354.76
136.31
1,289.93
9
1,291.51
8
-0.1
1,224.85
1,173.97
1,146.45
D.C.
819.36
539.48
221.94
1,440.58
4
1,429.36
3
0.8
1,336.73
1,258.46
1,206.03
Florida
997.20
355.69
153.00
1,414.17
5
1,427.23
4
-0.9
1,353.35
1,262.25
1,190.50
Georgia
829.86
420.60
180.37
1,259.49
10
1,218.18
10
3.4
1,134.33
1,006.28
929.72
Hawaii
478.83
370.53
106.29
839.87
37
829.16
37
1.3
804.05
780.42
761.06
Idaho
433.66
270.36
142.89
738.10
48
722.14
47
2.2
679.28
633.40
599.02
Illinois
521.11
351.27
144.65
939.64
26
918.82
27
2.3
899.62
852.81
811.40
Indiana
444.98
288.97
138.86
777.05
43
771.23
43
0.8
747.98
705.52
671.16
Iowa
350.31
250.96
221.72
714.86
49
700.70
49
2.0
674.93
635.99
608.94
Kansas
426.14
285.92
286.48
818.99
39
806.67
39
1.5
768.50
719.73
708.98
Kentucky
609.98
307.91
168.11
935.61
27
951.86
24
-1.7
910.99
840.04
801.75
Louisiana
1,023.91
485.01
252.34
1,557.22
1
1,549.98
1
0.5
1,449.48
1,328.80
1,254.37
Maine
375.40
297.60
115.26
696.37
51
687.47
50
1.3
668.07
646.64
619.16
Maryland
749.18
430.21
168.01
1,236.61
12
1,211.87
12
2.0
1,150.74
1,081.81
1,020.68
Massachusetts
664.92
447.05
149.86
1,182.69
13
1,167.16
13
1.3
1,136.60
1,096.53
1,058.50
Michigan
979.47
478.54
162.01
1,495.94
2
1,471.65
2
1.7
1,361.65
1,304.11
1,268.10
Minnesota
502.32
274.20
214.55
892.17
33
872.82
33
2.2
841.11
809.56
791.72
Mississippi
544.43
364.63
238.95
975.58
23
973.86
22
0.2
933.01
879.13
840.48
Missouri
527.59
318.44
223.94
929.91
30
916.77
29
1.4
872.16
807.52
758.33
Montana
437.69
286.02
313.27
834.86
38
825.90
38
1.1
784.76
730.99
704.70
Nebraska
431.71
272.97
269.19
807.30
40
796.89
41
1.3
768.22
722.68
693.87
Nevada
925.71
374.59
119.19
1,292.52
8
1,262.25
9
2.4
1,143.54
1,062.42
1,012.70
New Hampshire
442.52
334.15
120.48
864.35
34
848.17
36
1.9
824.77
801.96
775.17
New Jersey
958.31
422.29
129.97
1,395.53
6
1,385.53
6
0.7
1,351.08
1,306.73
1,274.30
New Mexico
584.25
315.88
222.43
932.67
28
915.74
30
1.8
871.03
819.68
794.54
New York
932.46
469.82
172.85
1,445.30
3
1,425.39
5
1.4
1,350.50
1,303.15
1,245.32
North Carolina
392.06
344.07
138.40
741.70
47
727.09
46
2.0
693.13
666.37
639.01
North Dakota
312.30
284.09
264.98
703.73
50
686.09
51
2.6
662.31
639.13
637.24
Ohio
447.86
303.55
131.37
802.72
41
802.21
40
0.1
784.51
743.12
714.47
Oklahoma
504.79
338.87
270.19
908.95
31
918.03
28
-1.0
898.48
854.78
826.43
Oregon
684.81
281.69
109.76
990.00
22
990.30
21
0.0
962.41
889.03
831.80
Pennsylvania
548.58
383.01
171.18
992.33
20
996.64
20
-0.4
966.22
915.96
881.13
Rhode Island
918.30
491.19
141.03
1,382.64
7
1,348.83
7
2.5
1,300.64
1,230.90
1,170.98
South Carolina
715.26
317.95
211.29
1,114.90
16
1,098.57
16
1.5
1,025.22
930.76
870.57
South Dakota
337.11
248.09
347.61
745.33
46
721.76
48
3.3
696.09
652.30
624.52
Tennessee
479.43
353.43
168.07
863.39
35
858.20
34
0.6
823.28
778.80
753.73
Texas
650.17
434.46
285.56
1,143.85
15
1,152.25
14
-0.7
1,096.82
1,008.91
934.22
Utah
615.15
308.40
127.15
954.14
24
941.19
25
1.4
891.08
829.39
792.20
Vermont
374.06
333.38
148.88
785.37
42
777.93
42
1.0
762.54
732.96
700.46
Virginia
491.51
323.76
149.42
861.18
36
855.75
35
0.6
821.42
785.59
756.46
Washington
705.11
325.38
121.13
1,066.84
17
1,035.59
18
3.0
994.88
935.35
890.18
West Virginia
515.20
352.97
225.50
946.03
25
938.78
26
0.8
914.16
897.94
883.34
Wisconsin
421.21
250.73
168.52
767.42
45
756.20
45
1.5
732.20
701.47
670.98
Wyoming
356.08
292.37
335.04
776.22
44
765.83
44
1.4
744.50
714.17
692.05
United States
$650.35
$381.43
$171.87
$1,070.47
$1,059.41
1.0%
$1,008.52
$945.02
$896.66
(1) Ranked highest to lowest by average expenditure.
Note: Average expenditure=Total written premium/liability car years. A car year is equal to 365 days of insured coverage for a single vehicle. The NAIC does not rank state average expenditures and does not endorse any conclusion drawn from these data.
Louisiana, Florida and Michigan are the least affordable states for auto insurance, while Iowa is the most affordable state, according to a study from the Insurance Research Council (IRC). The report, Auto Insurance Affordability: Countrywide Trends and State Comparisons, looks at the auto insurance expenditure share of income, which ranges from a low of 1.02 percent in Iowa for 2018, the latest data available, to a high of 3.09 percent in Louisiana. U.S. households on average spent 1.67 percent of their income on auto insurance. The IRC developed an affordability index based on average auto insurance expenditures published by the National Association of Insurance Commissioners (NAIC) (see charts here) and median household income from the U.S. Census Bureau. According to the IRC, Louisiana, Florida, and Michigan have maintained their respective rankings as the first, second, and third least affordable states since 2014. The IRC notes that since the index is a ratio, some states with high average auto insurance expenditures rate lower on the affordability rankings because of higher-than-average median income (such as DC), while other states are pushed up the ranks of least affordable states by having low median household income (such as Mississippi). The analysis discusses the affordability of auto insurance for the overall population and does not address the issue of affordability among underserved populations.
Average Auto Insurance Expenditures As A Percent of Median Household Income, 2018 (1)
Rank
State
Percent
Rank
State
Percent
1
Louisiana
3.09%
27
Oregon
1.43%
2
Florida
2.61
28
Montana
1.43
3
Michigan
2.43
29
Maryland
1.41
4
Mississippi
2.27
30
Alaska
1.40
5
Georgia
2.17
31
North Carolina
1.38
6
Rhode Island
2.14
32
Massachusetts
1.35
7
New York
2.12
33
Illinois
1.31
8
Nevada
2.04
34
Washington
1.30
9
Delaware
1.99
35
Ohio
1.29
10
Texas
1.93
36
Indiana
1.28
11
New Mexico
1.90
37
Kansas
1.26
12
South Carolina
1.90
38
Idaho
1.23
13
New Jersey
1.87
39
Minnesota
1.22
14
West Virginia
1.86
40
Utah
1.22
15
Arkansas
1.81
41
Wyoming
1.22
16
Alabama
1.81
42
Wisconsin
1.21
17
Kentucky
1.72
43
South Dakota
1.21
18
Arizona
1.68
44
Nebraska
1.18
19
Oklahoma
1.68
45
Maine
1.17
20
DC
1.67
46
Virginia
1.11
21
Connecticut
1.67
47
Vermont
1.11
22
Colorado
1.55
48
Hawaii
1.04
23
Pennsylvania
1.54
49
New Hampshire
1.04
24
Tennessee
1.53
50
North Dakota
1.03
25
Missouri
1.48
51
Iowa
1.02
26
California
1.47
Total U.S.
1.67%
(1) Data are for IRC's affordability index based on average auto insurance expenditures published by the National Association of Insurance Commissioners (NAIC) (see charts here) and median household income from the U.S. Census Bureau.
(1) After reinsurance transactions, excludes state funds.
(2) After dividends to policyholders. A drop in the combined ratio represents an improvement; an increase represents a deterioration.
(3) Calculated from unrounded numbers.
Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.
Liability insurance pays for the policyholder’s legal responsibility to others for bodily injury or property damage. Collision and comprehensive insurance cover property damage and theft to the policyholder’s car.
Private Passenger Auto Insurance Losses, 2011-2020 (1)
Liability
Bodily injury (2)
Property damage (3)
Year
Claim frequency (4)
Claim severity (5), (6)
Claim frequency (4)
Claim severity (5), (6)
2011
0.92
$14,848
3.56
$2,958
2012
0.95
14,690
3.50
3,073
2013
0.95
15,441
3.55
3,231
2014
0.97
15,384
3.41
3,516
2015
0.89
17,014
3.45
3,628
2016
0.95
16,913
3.45
3,843
2017
1.00
16,761
3.45
3,933
2018
1.02
17,596
3.33
4,165
2019
1.01
18,680
3.27
4,331
2020
0.85
20,235
2.48
4,711
Physical damage (7)
Collision
Comprehensive (8)
Year
Claim frequency (4)
Claim severity (5)
Claim frequency (4), (9)
Claim severity (5), (9)
2011
5.75
$2,861
2.79
$1,490
2012
5.57
2,950
2.62
1,585
2013
5.71
3,144
2.57
1,621
2014
5.93
3,169
2.79
1,572
2015
6.01
3,377
2.72
1,679
2016
6.13
3,442
2.76
1,747
2017
6.14
3,423
2.86
1,811
2018
6.13
3,578
3.02
1,832
2019
6.07
3,752
3.23
1,777
2020
4.63
3,588
2.94
1,995
(1) For all limits combined. Data are for paid claims.
(2) Excludes Massachusetts and most states with no-fault automobile insurance laws.
(3) Excludes Massachusetts, Michigan and New Jersey.
(4) Claim frequency is claims per 100 earned car years. A car year is equal to 365 days of insured coverage for one vehicle.
(5) Claim severity is the size of the loss.
(6) Includes loss adjustment expenses.
(7) Excludes Massachusetts, Michigan and Puerto Rico. Based on coverage with a $500 deductible.
(8) Excludes wind and water losses.
(9) Includes glass losses.
In 2018, 1.1 percent of people with liability insurance had a bodily injury liability claim, while 3.9 percent of those with liability insurance had a property damage liability claim, according to ISO.
In 2018, 6.1 percent of collision insurance policyholders had a claim, while 3.0 percent of people with comprehensive coverage had a claim.
In 2018 the average auto liability claim for property damage was $3,841; the average auto liability claim for bodily injury was $15,785.
In 2018 the average collision claim was $3,574; the average comprehensive claim was $1,833.
Incurred Losses For Auto Insurance, 2016-2020 (1)
($000)
2016
2017
2018
2019
2020
Private passenger auto
Liability
$88,249,238
$90,495,835
$91,736,331
$96,191,310
$81,618,462
Physical damage
55,738,221
57,052,411
58,766,743
62,638,267
54,683,622
Commercial auto
Liability
14,987,073
15,528,570
17,810,709
20,435,099
19,313,224
Physical damage
4,279,414
4,874,748
4,999,100
5,407,130
4,813,211
Total
$163,253,946
$167,951,564
$173,312,883
$184,671,806
$160,428,519
(1) Losses occurring within a fixed period, whether or not adjusted or paid during the same period, after reinsurance transactions.
Source: NAIC data, sourced from S&P Global Market Intelligence, Insurance Information Institute.
The shared/residual market and nonstandard markets
All states and the District of Columbia use special systems to guarantee that auto insurance is available to those who cannot obtain it in the private market. These systems are commonly known as assigned risk plans. Assigned risk and other plans are known in the insurance industry as the shared, or residual, market. In assigned risk plans, high-risk policyholders are proportionally assigned to insurance companies doing business in the state. In the voluntary, or regular, market, auto insurers are free to select policyholders.
Motorists can also obtain auto insurance from the nonstandard portion of the private market. The nonstandard market is a niche market for drivers who have a worse than average driving record or drive specialized vehicles such as high-powered sports cars or custom-built cars. It is made up of both small specialty companies, whose only business is the nonstandard market, and well-known auto insurance companies with nonstandard divisions.
Collision losses
The chart below shows the claim frequency and average loss payment per claim and average loss payment per insured vehicle year under collision coverage for recent model vehicles. The claim frequency is expressed as a rate per 100 insured vehicle years. A vehicle year is equal to 365 days of insurance coverage for a single vehicle.
Passenger Vehicle Collision Coverage Insurance Losses, 2018-2020 Model Years
Claim frequency (1)
Claim severity
Overall loss (2)
Passenger cars (3)
7.2
$6,831
$495
Pickups
5.5
6,925
381
SUVs
5.5
6,816
377
All passenger vehicles (4)
6.1
$6,839
$419
(1) Per 100 insured vehicle years.
(2) Represents the average loss payment per insured vehicle year.
(3) Includes minivans.
(4) Includes claims from cargo/passenger vans.
The Bureau of Labor Statistics consumer price index (CPI) tracks changes in the prices paid by consumers for a representative basket of goods and services. The cost of living (all items) rose 4.7 percent in 2021. The cost of motor vehicle insurance increased 3.8 percent after a 4.6 percent decline in 2020, when drivers reduced their driving due to the COVID-19 pandemic. The cost of tenants and household insurance declined slightly, down 0.3 percent. Used cars and trucks increased a significant 26.6 percent and the median price of a single-family home increased 17.7 percent and nearly 100 percent since 2012.
Consumer Price Indices For Insurance And Related Items And Annual Rates Of Change, 2012-2021
Consumer Price Indices For Insurance And Related Items And Annual Rates Of Change, 2012-2021 (Cont'd)
(Base: 1982-84=100)
Used cars and trucks
Tenants and
household insurance (3), (4)
Repair of
household items (3), (5)
Legal services
Existing single-
family homes
Year
Index
Percent change
Index
Percent change
Index
Percent change
Index
Percent change
Median price ($000)
Percent change
2012
150.3
0.9%
131.3
3.1%
198.7
NA
303.5
2.0%
177
6.5%
2013
149.9
-0.3
135.4
3.1
206.7
4.0%
311.8
2.8
197
11.4
2014
149.1
-0.5
141.9
4.8
212.4
2.8
318.5
2.1
208
5.7
2015
147.1
-1.3
146.4
3.2
220.1
3.6
323.6
1.6
224
7.5
2016
143.5
-2.5
147.7
0.9
226.3
2.8
334.5
3.4
236
5.2
2017
138.3
-3.6
148.8
0.7
239.3
5.8
346.4
3.6
247
5.6
2018
138.4
0.1
150.7
1.3
253.7
6.0
361.2
4.3
262
5.1
2019
139.8
1.0
151.8
0.7
268.7
5.9
364.8
1.0
275
5.0
2020
144.2
3.2
151.1
-0.5
270.0
0.5
368.7
1.1
300
9.3
2021
182.6
26.6
150.7
-0.3
NA
NA
374.4
1.5
353
17.7
Percent change,
2012-2021
21.5%
14.8%
NA
23.4%
99.4%
(1) December 1996=100.
(2) December 1983=100.
(3) December 1997=100.
(4) Only includes insurance covering rental properties.
(5) Includes appliances, reupholstery and inside home maintenance.
NA=Data not available.
Note: Percent changes are calculated from unrounded data.
Source: U.S. Department of Labor, Bureau of Labor Statistics; National Association of Realtors.