Why Is Car Insurance So Expensive?

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Why Is Car Insurance So Expensive? – You may be wondering why your car insurance is so expensive due to the significant increase in the rate charged by your insurers. Well, there are so many reasons why your car insurance may be on the high side, and understanding these reasons will enable you to make decisions on how to lower the cost.

Why Is Car Insurance So Expensive?

Recognizing the challenge that a lot of drivers face juggling expenses and all, we are going to be offering tips on how individuals can reduce the cost of their car insurance. But before then, let us take a look at some of the reasons why car insurance is expensive.

Why Is Car Insurance So Expensive?

As we have mentioned earlier, several reasons could affect the rate of your car insurance. Car insurance can be expensive due to certain factors, such as;

Age and Gender

Age and gender is by far the major reason that determines the cost of car insurance. Although it seems unfair, most insurers calculate their insurance premiums based on age and gender. In most states, except California, Hawaii, Massachusetts, Michigan, North Carolina, and Pennsylvania; insurers factor in your age and gender and decide on the amount of premium you’ll pay.

In addition, teen drivers are likely to pay more for car insurance because they are considered less driving experience. And because of this, they are prone to accidents on the road.  Furthermore, men are more like to engage in risky Chevy behaviors, hence, the reasons they pay higher rates than women.


Your place of residence plays a vital role in the cost of your car insurance. If you live in an urban area where the chance of getting into an accident is high, you will be charged higher rates. Also, living in a place where car repairs are more expensive and there’s a high level of criminal activities could adversely increase the cost of your insurance.

Car Make and Model

Another thing that could impact your car insurance rate is the model of the car you’re insuring. More often than not, the least expensive cars and cheaper to insure while the ones with high market value or more expensive to insure.

Marital Status

Also, your marital status goes a long way in the cost of your insurance rates. Most married people are offered discounts by their insurers; this means that they most definitely get to pay less than those who are single.

While married people tend to pay less on their car insurance rate, single people should expect to pay higher rates.

Credit History

Another thing that can lead to your car insurance being expensive is if you have a poor credit history. Most insurance companies use a credit-based insurance score to determine the rate you’ll be charged for car insurance. Owning to the fact that those with bad credit are more likely to file claims, they generally pay more than those with good credit history.

DUI Record

You can’t escape higher rates on your car insurance if you have a DUI record. Those who are convicted of a DUI are faced with serious challenges, one of which is high insurance rates. In worst-case scenarios, they might struggle to find coverage and if they eventually do, high premium awaits them. Why drink and drive, when you can just adhere to the rules of safe driving?

Insurance Lapse

If there’s a lapse in your car insurance coverage, it can serve as a red flag and thus, could lead to higher rates. A lapse on car insurance is often not taken as a big deal but could lead to high rates if it is not addressed as soon as possible. Whether your policy was canceled or you were dropped for not paying your auto insurance on time, a palled in your insurance coverage will most likely attract high premiums from insurers. To get the best car insurance rates, it is advisable to maintain continuous coverage on your car insurance.

Type of Coverage

Lastly, the type of coverage you select on your auto insurance policy determines the cost of your insurance. Yes, it is ideal to have sufficient coverage to protect against a wide range of risk but be in the know that, the higher the coverage selected, the higher your insurance rates. So, if you choose a type of coverage that attracts higher rates, you should be prepared for the cost attached.

How to Reduce Car Insurance Costs

Just as we have highlighted in this article, there are so many factors that contribute to the rage ag which car insurance is getting high. Notwithstanding, there are steps you can take to lower the cost of your car insurance, some of which include;

Choose the Right Car

    Most insurers determine the cost of car insurance based on the type of car you’re insuring so before you purchase a new car, research how much it costs to insure the type of car you have an eye for. Choosing the right car that suits your insurance budget makes financial sense.

    Maintain A Clean Driving Record

    You can take driving courses that would help improve your driving skills. If you have a good driving record, most insurance companies will be glad to offer you low insurance rates simply because you’re less prone to accidents.

    Maintain a Good Credit Score

     Most insurance companies review your credit score and determine the amount you’ll be charged for premiums on your auto insurance. If you’re a driver with a good credit score, there’s every tendency to find lower car insurance rates.

    Compare Car Insurance Quotes

    This is one of the best ways to reduce the cost of auto insurance. It is easier to discover better deals by comparing multiple car insurance quotes from different insurers. Even drivers with bad credit can save on car insurance if they shop around for low and competitive rates.

    Choose the Right Coverage and Deductible

    To lower the cost of your car insurance, choose the right coverage and high deductible. If you have an older car with a lower market value, it is wise to drop collision or comprehensive coverage of it was included in your policy. This would help to reduce the amount of premiums you pay on your car insurance. Also, raising your deductibles is a great way to reduce the cost of your auto insurance.

    Pay Premiums Upfront

    Most insurance companies allow you to save costs if you pay your premiums at once rather than paying in installments. Those who pay their premiums upfront stand a chance of saving costs that would ultimately reduce the amount they pay on their car insurance.

    Bundle Auto and Homeowners Insurance

    Summarily, another great way to reduce car insurance costs is by bundling policies together. Most insurers offer policyholder discounts if they purchase both auto and homeowner policies from them. When you bundle auto and homeowners insurance, there are discounts that you can benefit from.


    With all that has been said so far, policyholders must understand that there several factors that contribute to the high cost of car insurance. We have mentioned some of the factors in this article. However, while car insurance may be expensive for a lot of reasons, it offers financial protection and peace of mind for drivers in the event of an accident.