According to Insurify, the average national cost of car insurance in 2022 is expected to rise 5% to $1,707 per year, up from $1,663 in 2021.
Our forecast for 2022 is in line with projected inflation rates, and it takes into account the continued rise in reckless driving behaviors, which have become more common since the 2020 Covid lockdowns," said Tanveen Vohra, Insurance Specialist at Insurify.
Inflation is affecting almost every aspect of American life, with prices for everything from groceries to cars and gas rising. According to the most recent data, inflation is rising at a 6.8 percent annual rate, well above the Federal Reserve's 2 percent target.
Meanwhile, according to Insurify's research, Americans drove 32% more miles in March, April, and May of 2021 compared to the same months in 2020, when shutdowns early in the pandemic resulted in fewer cars on the road.
The fatality rate, however, was 26% higher in spring 2021 than it was in 2019, pre-pandemic, "suggesting that reckless driving habits adopted during initial pandemic shelter-in-place orders have endured well beyond the onset of the pandemic," according to the report.
Of course, the exact amount you pay is determined by a number of factors, including the make and model of your car, your coverage options, as well as factors such as your driving record and, in some cases, your credit score.
Location is also important. According to Insurify, the most expensive state for car insurance is Michigan, which costs an average of $2,858 per year, followed by New York and Rhode Island, which both cost an average of $2,321 per year.
Hawaii is the least expensive state, with an average annual layout of $824. North Carolina ($924), Maine and Vermont (both $945) are close behind.
Furthermore, if you live in an urban area, you will pay more on average ($1,666 per year) than drivers in rural areas ($1,472 per year). According to the research, a single prior traffic offense can raise your premiums by an average of 35%.
Aside from dropping parts of your coverage or raising your deductibles, there are ways to reduce your costs.
According to Insurify, bundling — that is, getting both auto and homeowners insurance from the same provider — can save you an average of 8% per year. Alternatively, if you are a member of the military, you can save 2.2 percent. In addition, as an older American, you could save up to 15.2 percent by taking a driver safety training course.
"The best way to find a lower rate, however," Vohra said, "is to shop around and get quotes from multiple insurers to find the one that gives you the best deal."
To conduct its research, Insurify examined more than 40 million auto insurance premiums in its database.