2023 vs. 2024 Insurance Rates

Have you noticed your car insurance rates going up lately? It’s not just you—many drivers have seen their premiums increase significantly over the past year. Today, the average cost of car insurance sits at a whopping $2,049 per year, a 12.4% increase from 2023 when the national average was an estimated $1,823 annually. 

But that’s not all that has changed. The least expensive state to insure a vehicle also looks different this year than it did last year. In 2023, the cheapest state for car insurance was Vermont, with an average annual premium of $1,078. However, in 2024, the cheapest state is Wyoming with an annual premium of $1,172. 

Several factors have contributed to this rise in rates. Firstly, insurance always lags behind the rate of inflation. This means that in the wake of high inflation, insurance rates will follow suit. Second, the cost of repairing vehicles has escalated with the advancement of car technology. Newer cars tend to have more sophisticated features, which can make repairs pricier. Lastly, severe weather events are occurring more frequently. This increases the likelihood that a policyholder will file a claim due to weather damage, and thus, increases the financial risk for insurance companies. 

Knowing how quickly insurance rates can change, it’s always wise to keep an eye on your insurance premiums and periodically shop around to compare quotes. Staying on top of your rates and comparison shopping could help you to find a better deal at a new provider that works with your current driving habits and budget.