Some Americans Consider Driving Less, Skipping Coverage in Face of Rising Insurance Costs
Published Oct. 26, 2022
Insurify released its 2022 Auto Insurance Trends Report: Who’s Paying More for Coverage, the first part of a two-part report that comprehensively covers 2022’s unique car insurance landscape.
Insurify’s report leverages more than 40 million car insurance rates from proprietary car insurance applications across the U.S. It details who is paying more for car insurance in 2022, surveys drivers on how they’re managing rising vehicle costs and provides drivers with expert advice on how they can save.
The report showed the average American is spending $1,705 per year on auto insurance in 2022, up 4% from 2021 and a whopping 17% from 2020.
Michigan drivers pay the most for car insurance, spending $2,510 per year on average---$805 more than the national average and $1,748 more than the yearly average of $762 in Hawaii, the cheapest state for auto insurance.
Across the country, drivers pay 5% less for coverage just for being married, and up to 17% less if they own their home.
“Since 2016, Insurify has provided Americans with the most comprehensive and accurate selection of auto insurance quotes," said Snejina Zacharia, Insurify’s CEO and founder. “Our annual data reflects the state of the nation’s economy through an insurance lens, and our 2022 report illustrates how rising inflation and recent interest rate hikes are affecting the American public and how they are responding.”
Key findings from the report include:
Luxury, Electric Cars Priciest to Insure
Tesla Model 3 owners have the second-most expensive car insurance premiums of any vehicle model in 2022, according to Insurify data. Model 3 drivers are spending $3,040 per year for auto insurance---$1,335 more than the national average. The Infiniti Q5 is the most expensive vehicle to insure in 2022 with an average premium of $3,149 per year.
Northeast Drivers Pay Up for Coverage
Northeast drivers are also paying more for car insurance in 2022. Five Northeast states---New York, Maryland, Delaware, Connecticut and New Jersey---rank among the 10 most expensive states for auto insurance. The average driver in one of these states is paying $2,220 per year for coverage, $515 more than the national average.
Ways Americans are Considering Cutting Insurance Costs
In the face of rising vehicle ownership costs, the report also found 65% of Americans are considering driving less and 10% are thinking about dropping their car insurance coverage altogether, despite the serious legal and financial risks of driving without insurance.
Americans are additionally considering the following actions to save on vehicle insurance, fuel and maintenance expenses in 2022:
- 30% of drivers are thinking about purchasing a hybrid or electric vehicle
- 30% of drivers are considering switching to a different insurance provider
- 16% of drivers are thinking about moving to a different location with better public transportation and walkability
For Americans, the insurance market’s current volatility likely won’t stabilize until at least mid-2023, according to Betsy Stella, Insurify’s vice president of insurance partnerships.
“Based on our comprehensive research and feedback from over 100 carriers, the general consensus is that it will be eight to 12 months [from fall 2022] before the market stabilizes," Stella said. "Some think it could be several years before a soft market returns.”
With prices potentially on the rise for the foreseeable future, Insurify’s experts recommend comparing quotes from at least four to five insurance companies every six months or so to find the best policy for their needs.
Drivers should also explore any discounts for which they might qualify, including bundling home and auto insurance and taking a senior driving training course. According to Insurify data, a single discount can lower car insurance premiums by up to 15%, amounting to yearly savings of $258 for the average driver.