Top 10 states with the largest increase in car insurance premiums

States with the most significant increase in premiums

Washington, D.C., saw the biggest jump in car insurance premiums, with increases of about 21%, followed by Idaho at 19%, New Jersey and Washington at around 18% each, and Mississippi at roughly 15% from 2024 to 2025, based on Insurance.com data.

Several other states, including Minnesota, Maryland, Wyoming, Colorado, Michigan, Nebraska, Virginia, Arizona, California, and Kentucky, also recorded moderate increases ranging from 5% to 10%.

The table below shows the change in car insurance premiums by state from 2024 to 2025.

State	2024 average rate	2025 average rate	% change
Washington, D.C.	$3,082	$3,730	21%
Idaho	$1,909	$2,270	19%
New Jersey	$2,665	$3,133	18%
Washington	$2,285	$2,698	18%
Mississippi	$2,242	$2,589	15%
Texas	$3,312	$3,754	13%
Vermont	$1,637	$1,844	13%
Iowa	$2,457	$2,717	11%
New York	$3,044	$3,378	11%
Wisconsin	$2,032	$2,260	11%
Minnesota	$2,603	$2,858	10%
Maryland	$2,364	$2,582	9%
Wyoming	$2,041	$2,212	8%
Colorado	$2,888	$3,092	7%
Michigan	$3,415	$3,662	7%
New Hampshire	$1,694	$1,810	7%
Delaware	$3,314	$3,523	6%
Georgia	$2,772	$2,951	6%
North Dakota	$2,739	$2,903	6%
Nebraska	$2,535	$2,682	6%
Virginia	$2,169	$2,299	6%
Arizona	$2,436	$2,562	5%
California	$3,342	$3,506	5%
Kentucky	$2,969	$3,125	5%
Maine	$1,740	$1,830	5%
Connecticut	$3,046	$3,168	4%
Massachusetts	$3,015	$3,127	4%
Ohio	$1,729	$1,800	4%
Pennsylvania	$2,428	$2,528	4%
Kansas	$2,700	$2,789	3%
Louisiana	$3,909	$4,010	3%
Alaska	$2,398	$2,436	2%
Indiana	$1,886	$1,916	2%
Oregon	$2,266	$2,315	2%
Rhode Island	$2,868	$2,915	2%
Utah	$2,114	$2,162	2%
Hawaii	$1,857	$1,871	1%
New Mexico	$2,761	$2,779	1%
South Carolina	$2,764	$2,789	1%
Florida	$4,051	$4,071	0%
Oklahoma	$2,941	$2,949	0%
West Virginia	$2,288	$2,272	-1%
Arkansas	$2,845	$2,778	-2%
Missouri	$2,447	$2,393	-2%
Tennessee	$2,371	$2,318	-2%
Alabama	$2,266	$2,209	-3%
Montana	$2,523	$2,457	-3%
Nevada	$4,118	$3,946	-4%
South Dakota	$3,044	$2,905	-5%
Illinois	$2,105	$1,987	-6%
North Carolina	$2,424	$2,162	-11%

Louw points out that a handful of these states are densely populated, where the risk of accidents is greater because more people are on the road.

Why are car insurance premiums rising?

Car insurance premiums are rising due to inflation, higher repair costs, increased accident severity, supply chain issues, and more expensive vehicles and parts.

Friedlander points out that the dip in rates during the pandemic was short-lived, with rates bouncing back and then rising even higher.

"Personal auto insurance premiumThe payment required for an insurance policy to remain in force. Auto insurance premiums are quoted for either 6-month or annual policy periods. rates have returned to pre-pandemic levels. But several issues may continue to put upward pressure on rates," he says. "At the beginning of the pandemic, auto insurers -- anticipating fewer accidents amid the economic lockdown -- gave back approximately $14 billion to policyholders in the form of cash refunds and account credits. But while miles driven declined and accident frequency initially dropped, frequency and severity quickly increased again. Traffic fatalities also increased, after decades of steady declines."

Insurers' personal auto loss ratios actually fell sharply, but only briefly, in 2020. However, they have since risen steadily to surpass pre-pandemic levels. Because more drivers are on the road today and replacement parts costs continue to rise, this loss trend is expected to persist, Friedlander says.

Does the COVID-19 pandemic still affect car insurance prices today?

Yes, the COVID-19 pandemic still affects car insurance rates today, mainly through higher inflation, supply chain disruptions, and increased vehicle repair and replacement costs.

Louw points to various other reasons for rate increases since the coronavirus crisis hit.

"These include inflation, disruptions in the supply chain, and a change in driving habits. Between December 2020 and December 2021, the Consumer Price Index increased by 7%, resulting in us paying higher prices for services and goods. And during that time, the price of new vehicles jumped by 11.8%," she says.

The pandemic triggered supply chain disruptions, leading to a shortage of chips and semiconductors needed for automobiles, too. As a result, parts and labor became more costly.

In addition, according to Cummins, repair costs have increased. Plus, if you get into an accident and your vehicle has to wait at the repair shop longer than usual, you may need a rental car, which is typically covered by your insurance company. To recover some of those costs, your carrier will probably increase your premium.

Other factors that affect the cost of auto insurance

Your car insurance premium is influenced by personal factors like your driving record, vehicle type, coverage level, and demographics.

Here’s how various factors impact rates:

Age and gender: Younger drivers usually pay more because they’re considered higher risk based on accident data.
Vehicle make and model: Luxury or high-performance cars cost more to insure due to higher repair costs.
Driving history and habits: A clean driving record can help lower rates, while accidents, speeding tickets, or violations increase premiums.
Coverage type and limits: Higher coverage limits and more comprehensive protection increase your premium because the insurer takes on more risk.
Deductible amount: Choosing a higher deductible usually lowers your monthly premium, but you’ll pay more out of pocket if you file a claim.

States that had the biggest decrease in premiums

North Carolina had the largest drop, about 11%, followed by Illinois, at around 6%, from 2024 to 2025, among the small number of states saw car insurance premiums decline, even as most states saw increases.

Here are the six states with the largest decreases in premiums from 2024 to 2025.:

State	2024 average rate	2025 average rate	% decrease
North Carolina	$2,424	$2,162	-11%
Illinois	$2,105	$1,987	-6%
South Dakota	$3,044	$2,905	-5%
Nevada	$4,118	$3,946	-4%
Alabama	$2,266	$2,209	-3%
Montana	$2,523	$2,457	-3%

Premium decreases are generally linked to lower driving exposure, regional risk changes, and variations in insurance competition across states.

"It's possible that rates dropped in these metro-heavy areas because of the pandemic's effect on the greater population commuting to work. These states offer great public transportation where the population is most dense, making cars -- and car insurance -- more obsolete," Hill says.

Do all states require car insurance?

All U.S. states require minimum liability insuranceLiability insurance covers sums that an insured becomes legally obligated to pay because of bodily injuries or property damage, or financial losses caused to other people. except New Hampshire; even there, drivers are financially responsible in an accident. Some states require additional coverage.

Minimum liability insurance coverage limits are represented as three numbers, such as 25/50/25, which are the limits for bodily injury per person and per accident, and for property damage.

25/50/25 provides the following coverage:

Up to $25,000 per person for injuries (medical bills, lost wages, pain and suffering)
Up to $50,000 total per accident for all injuries combined
Up to $25,000 for property damage (vehicles, buildings, and other property)

How you can save on car insurance

You can lower your car insurance costs by comparing quotes, bundling policies, increasing your deductibleThe deductible is the amount you pay out of pocket for a covered loss when you file a claim., driving less, and maintaining a clean driving record.

"First, shop around for coverage. Get at least three quotes from national and regional insurers to compare pricing for the same level of coverage," Friedlander says. " Prices can differ by hundreds of dollars or more for the same level of coverage, so it pays to shop your policy at policy renewal time."

Bundle your insurance:Using the same provider for auto and home insurance can significantly reduce total costs.
Increase your deductible: A higher deductible means lower premiums and vice versa. “By choosing a higher deductible on your car insurance, you can significantly lower your premium cost. However, it’s important to make sure you have enough money set aside to pay the higher deductible out-of-pocket if you have a claim,” Friedlander says.
Use low-mileage discounts: If you drive less than average (e.g., carpooling or remote work), you may qualify for lower rates.
Try usage-based insurance: Usage-based insurance tracks your driving habits and uses the data to calculate your rates. “Many insurers offer usage-based discounts if you allow them to track your driving habits with a telematics plug-in device or mobile app,” Friedlander says.
Maintain a clean driving record: Safe drivers pay lower rates, while those with tickets and accidents pay more.
Improve your credit score: In most states, credit impacts rates, and better credit means lower rates.
Choose the right vehicle: Older, used, and non-sport vehicles typically cost less to insure than luxury or high-performance cars.

By combining these strategies, you can significantly reduce your car insurance costs while maintaining the coverage you need.

How can you manage rising car insurance costs in the U.S.?

The most effective approach is to compare quotes regularly instead of auto-renewing, adjust your deductible based on what you can realistically afford, and look for discounts that fit your lifestyle. Small changes, like driving less or switching to a usage-based plan, can slowly add up to meaningful savings over time. Stay on top of your rates.

Car insurance costs are rising in many places, but your premium is not completely out of your control. What you pay depends heavily on the choices you make, including how you drive, what car you own, and how you set up your coverage.

FAQ

How can I lower my car insurance premium quickly?

To get lower car insurance premiums quickly, shop around and switch to a cheaper provider, increase your deductible, and check for discounts that apply immediately, such as bundling or low-mileage savings.

Is it worth switching car insurance providers?

Yes, if you can find a lower rate from a reputable company. Switching providers can save money because different insurers price the same driver differently.

Does a higher deductible reduce insurance costs?

Yes. A higher deductible usually lowers your monthly premium, but you pay more out of pocket if you file a claimAn insurance claim is a request you make to your insurance company for coverage after your car is damaged or you have an accident. You can file a claim online, by phone, or in writing..