High car insurance rates? Clark Howard explains how to find relief

The average annual cost of full-coverage car insurance increased by more than 40% from 2021 to 2025, according to Insurify.

Although rates vary by state and driver, some consumers continue to face high premiums. Driver Keltrus Lindsey said his rate increased even though he had no tickets or accidents.

“They had me low the first year. And then next year, no tickets, no accidents, nothing. And it goes up,” Lindsey said. “I’m like, why does it keep going up?”

Boston 25 Consumer advisor Clark Howard said drivers do not have to accept high renewal rates without searching for alternatives.

“The auto insurance industry makes it hard for you to comparison shop one company to another,” Howard said. “But the more you push through and compare, the better you’re going to do in your wallet.”

Research insurance costs before buying a car

The type of vehicle you own can have a major effect on what you pay for insurance.

According to Insurify figures, full coverage auto insurance for a Tesla Model 3 costs around $300 per month, $168 for a Ford Explorer, and $138 for a Subaru Crosstrek.

Electric vehicles can save drivers money on gasoline and routine maintenance, but higher repair costs can lead to more expensive insurance premiums.

Howard recommends researching insurance rates before buying any vehicle.

Don’t automatically accept your renewal rate

Receiving an annual renewal notice does not mean you are locked into the new premium.

Driver Donna Panter said she contacted her insurance company after seeing a large increase.

“I called them and asked them what’s going on because it was like a big jump,” Panter said.

Howard said drivers should still compare quotes from multiple companies. He warned that some websites promoted as comparison-shopping tools may direct shoppers toward one insurance company instead of providing a complete comparison.

Drivers may need to contact individual insurers or visit each company’s website to get quotes based on the same coverage limits and deductibles.

Consider using an independent insurance broker

Drivers who find comparison shopping overwhelming can contact an independent insurance broker.

Independent brokers can search among multiple insurers to find policies that fit a customer’s needs.

Elaine Jones, owner of Atlanta Premier Insurance Agency, said insurers cannot arbitrarily increase premiums simply because they did not meet their profit goals.

Raising your deductible could lower your premium

Drivers may also save money by raising their deductible, which is the amount they must pay before insurance covers a claim.

“If you’re willing to take on more of the financial risk, then raising your deductible is a good thing,” Jones said.

A higher deductible can lower a driver’s premium, but it also means paying more out of pocket after a crash or another covered loss. Drivers should make sure they have enough savings to cover the higher amount.

Drivers who are still making car payments should check with their lenders before making a change. Auto lenders may limit the maximum deductible allowed under a loan agreement.

A higher deductible can also help drivers avoid filing smaller claims.

Look for defensive-driving discounts

If comparison shopping does not produce a better rate, drivers can check whether their state offers an approved defensive-driving course that qualifies them for a mandatory insurance discount.

Requirements and discounts vary by state, so drivers should confirm that a course qualifies before enrolling.

Check your credit reports for errors

Drivers should also review their credit reports and dispute any inaccurate information.

In states where the practice is permitted, insurers may use credit information to estimate how likely a customer is to file a claim. An error in a credit report could affect the rates a driver is offered.

“Everybody’s trying to save money,” Lindsey said. “Everybody needs auto insurance.”

Howard said the best way to compare prices may be to contact insurance companies individually or visit each company’s website to request a quote based on the coverage a driver needs.

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