Here’s How Much You’ll Pay in Insurance on Old and New Models of 5 Popular Cars
By Vance Cariaga,
2024-08-27
fizkes / iStock.com
One of the biggest expenses of owning a car is insuring it — and in most places, you don’t have a choice in the matter. You’re required to have some kind of car insurance to operate a motor vehicle in nearly every state. The lone exception is New Hampshire, where you’ll still need to prove you can afford to pay for damage in the event of an accident, according to Progressive.
The average yearly premium for a full-coverage car insurance policy across all vehicles was $2,329 during the first half of 2024, according to new data from Insurify . That comes out to about $194 a month and represents a 15% increase from the previous year, continuing a run of post-COVID rate hikes.
Actual insurance costs vary by factors such as your location, driving record and age, as well as the type of vehicle and its model year. While there are exceptions where you might pay more to insure the used model — such as a used car that has been upgraded with expensive entertainment systems or other features that are not included in the newer car — you can usually save a lot of money on car insurance by driving an older car rather than a new one.
The Insurify analysis found that the average cost of full coverage for vehicles in the 2011-2012 model year is $2,013 a year. In contrast, the average cost for vehicles in the 2023-2024 model year is $3,019 a year. That means you’re paying an additional $1,000 a year, or $84 a month, for a newer car.
Rising car insurance rates reflect an increase in underwriting losses suffered by insurers. Those losses have reached record levels in recent years due to a combination of skyrocketing car prices, higher repair costs and a rise in damage due to extreme weather events. Consumers have also been hit with higher rates due to legislative changes in some states that have increased liability for drivers.
Maryland has the highest car insurance costs in the U.S. with an average full-coverage rate of $3,400 a year, according to Insurify. New Hampshire, with no mandatory insurance, has the lowest costs at an average of $1,000 annually.
Other highlights from the Insurify report include the following:
California, Missouri and Minnesota could each see car insurance costs rise by more than 50% this year as increases in damage from severe storms and wildfires contribute to higher rates.
Vehicle maintenance and repair costs have increased by nearly 38% over the past five years, according to Bureau of Labor Statistics Consumer Price Index data reported by Insurify. Higher repair costs mean insurers pay “more expensive claims, and policyholders see higher premium hikes,” Insurify noted.
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