Car Insurance Calculator: How To Estimate Your Cost

The cost of car insurance is highly personalized and varies from person to person. Car insurance companies weigh several individual rating factors when considering which rate to charge you, including your age, driving record, address, the type of car you drive, and more. By using a car insurance calculator, you can get a ballpark estimate of how much car insurance will cost without entering your personal information.

The estimator can help you decide if it’s time to switch car insurance companies or find the right company that fits your needs and budget.

Not all car insurance companies are equal. Some will meet your needs better than others. Before you choose a company, take a look at their website to see the types of policies they offer and the coverages and discounts available.

Keep in mind: the best car insurance company may not be the cheapest. So shopping around, comparing quotes, and learning about the companies offering insurance in your area can help you find a balance between coverage and affordability.

Types of Car Insurance

There are many types of car insurance; some are optional, and some are mandatory, depending on where you live. Understanding insurance types will help you find a suitable policy to protect yourself and your passengers in an accident. Here are the most common types of car insurance:

Liability insurance

Liability coverage is a mandatory requirement for drivers in most states. It compensates others when you’re at fault for an accident that causes injuries, damage, or death. Auto liability insurance can also cover your legal expenses if another driver sues you for an accident you cause.

There are two forms of auto liability insurance: Bodily injury liability pays for the other driver’s medical expenses, while property damage liability coverage pays for vehicle repairs.

Uninsured/Underinsured motorist coverage

Uninsured motorist insurance covers you in an accident with an uninsured driver, while underinsured motorist insurance reimburses you if the at-fault driver’s policy is inadequate to cover your injuries or vehicle damages. UM and UIM usually pay for your medical expenses and those of your passengers in an accident.

In some states, the coverage can also pay for vehicle damages, lost wages, and funeral expenses in case of death.

Collision and comprehensive coverage

Collision coverage can help repair or replace your vehicle if you hit another vehicle or an object. Conversely, comprehensive insurance pays for non-collision occurrences, including vandalism, hail, storms, floods, earthquakes, or falling objects. Collision and comprehensive coverage are optional in all states, although lenders may require them if you’re financing or leasing a car.

Personal injury protection

Personal injury protection covers the injuries you and your passengers sustain in an accident. It also covers lost wages, funeral expenses, survivor benefits, rehabilitation, and replacement costs for accident victims. PIP is also known as no-fault insurance because it covers accident-related expenses regardless of who’s at fault.

PIP is part of the no-fault insurance laws and is mandatory in Delaware, Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon, and Utah. Some other states allow you to purchase optional PIP coverage.

Why do you need car insurance?

Car insurance covers unforeseen bills and liabilities arising from an accident. It protects you from hefty out-of-pocket expenses, provided you don’t exceed the coverage limit. Without it, you risk paying out-of-pocket to settle legal claims, medical expenses, and damages if you’re at fault. Here are some other reasons you need auto insurance:

Legal Requirements

Most states require basic liability coverage before you can legally register and drive a car. Driving without valid car insurance may lead to fines or even license suspension.

Car lease or financing

Banks, credit unions, and other lending institutions will require valid insurance to finance a car purchase. Likewise, car dealers will require you to purchase collision and comprehensive coverage before leasing a vehicle. Car insurance protects the company against financial losses if you file a claim after an accident.

How to calculate car insurance premiums

Every car insurance policy has a premium you must pay to get continuous financial protection. Most car insurance companies allow you to get a personalized rate quote online before you purchase a policy. However, some strategies can help you estimate your costs if you can’t access a car insurance calculator. Follow the steps below to calculate car insurance costs:

Choose the right car model

The first step to understanding insurance costs is determining the car model you want to insure. The make and model of your vehicle will impact the cost of your car insurance. In general, cars with a higher value are more expensive to insure. Choosing a used model can help you get a more affordable rate.

Determine the coverage you need

Most states require drivers to carry a minimum amount of car insurance. A minimum coverage policy is the cheapest option, but it offers little financial protection in an accident.

You can also buy full coverage insurance that includes comprehensive and collision protection. Unlike liability-only coverage, it pays for non-collision damages in different situations. However, it comes with higher premiums than liability-only coverage.

Finally, you can buy optional coverage to address your individual preferences. For example, if you have an old car that may break down suddenly, you may want to add optional roadside assistance to cover your towing needs.

Compare multiple quotes

Comparing quotes from multiple insurance companies allows you to see which company can give you the best deal for your personal situation and coverage needs. Comparing quotes also helps you understand recent changes in pricing if you haven’t purchased a car policy in some time.

How to estimate car insurance costs

Car insurance pricing and coverage needs are unique to you and your household. Each car insurance company you get a quote from will request personal information to complete a driving profile, which they will use to determine your rate. You may need to provide the following:

Date of birth
Gender
Marital status
Mobile phone number
Email address
Driver’s license number
Previous insurance information
Moving violation history
Home address
Vehicle identification number (VIN)

Considering the factors they use will help you estimate how much car insurance you need, including coverage options that may not be required but that you might want.

Driving Record

Insurance companies consider drivers with a history of speeding tickets and at-fault accidents a higher risk than those with no moving violations. Maintaining a clean record will help you get the cheapest rate with the best car insurance company.

Other Drivers

An insurance company will ask about every licensed driver in the household, not just the applicant. Failure to provide that information could result in denied claims if someone is involved in an accident and isn’t listed on the policy. Encourage everyone you live with to practice safe driving habits to help lower your rate.

Your Vehicle

If you have an older vehicle that doesn’t have a high book value, you may decide liability and uninsured motorist coverage are all you need. But if you have a new car that would be costly to fix, you may want the added protection of comprehensive and collision coverage. If you have a loan for your vehicle or lease it, it will likely be a requirement to have these coverages.

Existing Insurance

If you’re a new driver, strive to maintain a consistent insurance record without gaps in coverage. This saves you money on your insurance rates and means you’ll avoid fines for driving without insurance.

How are car insurance premiums calculated?

The cost of your car insurance premium is based on how likely your insurance provider thinks you are to claim, and how substantial any claim could be. To assess this, insurance providers look at various factors including:

Your occupation
Your annual mileage
Your address
How much voluntary excess you’re willing to pay
The make and model of your vehicle
Whether you’ve modified your car
Where you park your car overnight
Your age
Your driving history, including any no-claims discounts
Whether or not you’ve added any named drivers to your policy
The type of cover you’re taking out.

Ultimately, car insurance providers calculate your car insurance premium by assessing how big a risk you pose to them. They do this with the help of facts and statistics related to all these criteria.

Factors that affect the cost of car insurance

Your car make and model aren’t the only factors that go into an auto insurance quote. Others include:

Personal characteristics like age, gender, and marital status. For example, teen drivers have higher car insurance quotes on average than any other age group.
The coverage you choose. The more coverage you have, the higher your insurance rates are likely to be.
Your driving record. A recent DUI, speeding ticket or at-fault accident can raise your rates.
Your location. Every state has different car insurance minimums, and factors like your neighborhood’s crime rate and population density will affect your insurance price.
Your credit score. Drivers with poor credit typically have higher car insurance rates. Insurers use a credit-based insurance score, which is different from your regular credit score, to determine the likelihood you’ll file a claim. A credit-based insurance score is determined by factors like payment history and outstanding debt, but not personal information like income or occupation. California, Hawaii, and Massachusetts have banned insurers from using credit scores when calculating car insurance rates.
Your car insurance history. This can include whether your car insurance has lapsed, insurance claims, how long you’ve been with your insurer and your last insurance company.

Major factors that impact your car insurance cost estimates

Many factors go into calculating your car insurance cost. Consider these when getting quotes to compare for car insurance:

Liability-Only vs. Full Coverage: Full coverage will cost more than liability-only because of the additional coverages — comprehensive and collision coverage. Roadside assistance, rental car reimbursement and gap insurance are optional coverages that may also be included as part of full coverage.
Coverage Amounts: The more coverage, the higher your premium, but a greater level of financial protection, too. Plus, the more options you have if you’re in an accident or your car breaks down. Additional coverage could include roadside assistance, medical payments and rental car reimbursement.
Age: Drivers under the age of 30 and over 70 are statistically more likely to be involved in accidents and have higher fatality rates. Expect higher rates for teenagers and senior drivers than other age groups.
Location: Where you live can significantly impact your car insurance. Less dense populations in rural areas see fewer accidents and thefts than highly populated urban areas.
Driving Record: New drivers or drivers with several moving violations or at-fault accidents on their record are riskier to insure, which means they’ll pay more for car insurance. Drivers with a history of clean driving records not only get better rates, but they also may be eligible for other discounts.
Additional Coverage Required by State (PIP, UM, etc.): Some states mandate personal injury protection (PIP) and uninsured/underinsured motorist (UM/UIM) coverage, which costs extra. But even if optional, they may be worth considering since they can provide broader protection if you’re in an accident, whether as a pedestrian or driver, that involves a driver without insurance or minimal coverage.

Additional factors that impact your car insurance cost estimates

Credit Score: Paying your bills on time can mean lower car insurance rates in states that allow companies to use credit-based insurance scores when calculating premiums.
Car Choice: The make and model of your vehicle influence how much car insurance costs. The more your car is worth (its replacement cost value), the more you’ll pay for car insurance. This is because you’ll likely need additional coverages like comprehensive and collision, plus it will cost the insurance company more to fix your car if you file a claim.
Marital Status: If you’re married, your spouse must be listed as a driver on your insurance policy, which is great if they have a good driving history but can be costly if not. Even so, research shows that single drivers are twice as likely to be injured in an accident than married drivers, which can account for better insurance rates for married people compared to single consumers.
Deductible Level: Choosing a higher deductible for comprehensive or collision coverage or both will save you money on the premium, but you’ll have to pay more out of pocket if you file a claim for your vehicle’s damages. Liability coverage does not have a deductible.

How to lower your car insurance costs

Not everything is in your control when it comes to car insurance rates, but there are some steps you can take to lower your car insurance costs.

Take a defensive driving course

A speeding ticket or traffic violation can increase your rates, but you can correct the situation if you take a defensive driving course. The course available in many states is designed for first-time traffic offenders to correct their driving habits. The lessons generally focus on understanding traffic laws, acquiring basic car knowledge, and practicing safe driving habits.

Upon completion, you can get a ticket dismissal or point reduction on your driving license.

Depending on the insurance provider, a defensive driving course may also give you a discount on your premiums.

Compare quotes from multiple companies

Getting several quotes for the same coverage options can help you find the best deal and the most affordable car insurance.

Ask about discounts

Most car insurance discounts are stackable, so take advantage of everything you’re eligible for to lower your costs.

Improve your driving record

The better your driving record, the lower your rate for car insurance — one of many reasons to practice safe driving habits and do your best to avoid accidents and tickets.

Improve your credit score

Paying your bills on time can boost your credit score and lower your car insurance rate.

Ask about bundling your home & auto insurance policies

If you’re a homeowner or renter, opting to purchase home/renters and auto insurance from the same company can get you a bundling discount, which is one of the highest percentage discounts available.

How much car insurance do you need?

Most states require a minimum amount of car insurance, but you’ll likely want to have more than minimum coverage. Some drivers opt to get full coverage to help protect themselves against any type of accident. Remember, full coverage isn’t a type of policy, but generally a combination of required and optional coverages.

However, full coverage doesn’t include everything. Extras like roadside assistance and gap coverage may have to be added separately.

Full coverage car insurance may include:

Coverage type	What it pays for
Bodily injury liability	Medical costs due to injuries or deaths from an accident you caused.
Property damage liability	Repair costs for property you damaged in an accident.
Uninsured motorist bodily injury liability	Medical costs after an accident with an uninsured driver.
Uninsured motorist property damage coverage	Repair costs after an accident with an uninsured driver.
Collision coverage	Repair expenses from traffic-related accidents, regardless of who is at fault.
Comprehensive coverage	Repair costs from events outside your control — including weather events, hitting an animal while driving, theft and vandalism.

Which factors affect car insurance premiums?

Car insurance companies consider many factors when calculating your premiums. Here are some of the biggest factors that can impact your premium:

Vehicle type

The type of car you drive will determine how much you’ll pay for insurance. Companies will assess the theft and crash statistics of the car model to determine a general insurance rate. If a specific model has high theft and crash rates, you’ll likely pay more to insure the vehicle.

The manufacturer’s suggested retail price (MSRP) is another essential consideration. An expensive car will cost more to insure because the insurance provider will pay more to replace it if it’s stolen or totaled. Similarly, if the car has expensive parts, you’ll pay more for insurance than for a cheaper car.

Finally, a car’s safety record will affect your insurance costs. If the vehicle has adequate safety features, it offers more protection against injuries during an accident. Subsequently, you’ll pay a lower rate because there’s a lower risk of filing a medical claim in a car crash.

Driving record

Reputable insurance companies will examine your driving record when calculating insurance premiums. Some important factors include traffic violations, speeding tickets, and the frequency of at-fault accidents. For this reason, a DUI offense may double your insurance premiums, while an accident-free record will reduce your rates.

Credit score

Insurance companies use credit scores to determine your possibility of filing a claim. They will assess outstanding debts and your debt payment history; a poor score will generally lead to higher car insurance rates.

Location

Location is an essential factor in calculating insurance costs. Generally, urban areas have heavy traffic, high population density, and increased crime rates, which result in higher premiums. However, if you live in a rural community, you’ll often drive in less traffic and experience lower crime rates, which could help you get a lower rate.

State jurisdiction

Different states have regulations and requirements that impact insurance costs. As a result, an insurance policy can have varying prices across different states. Some states only require minimum liability coverage; in others, you must purchase extra coverage like personal injury protection. States such as Florida, Michigan, Delaware, New York, and New Jersey require extra coverage and have high insurance rates.

The frequency of accident lawsuits in your state can also impact insurance costs. Providers usually charge higher premiums to drivers from states with frequent lawsuits. An example is Louisiana, which has a higher rate of lawsuits and insurance claims than the national average and higher rates compared to other states.

Why some cars cost more to insure

Certain cars cost more to insure than others because carriers use crash and theft statistics to help set rates for each model separately. So if the car you choose tends to be stolen or crashed more, chances are you’ll pay more for insurance. For example, the reason sports cars cost more to cover is because they’re more likely to be driven fast and crashed hard by their owners.

Here are some specific vehicle characteristics that affect auto insurance costs:

Retail price. Generally, the pricier the car, the more expensive it will be to insure. If you buy comprehensive and collision coverage, the insurance company will be on the hook to pay out the car’s market value if the vehicle is stolen or wrecked beyond repair.
Cost of parts. High-end models often use parts made from carbon fiber and other specialized materials that are expensive to repair. This drives up the cost of damage claims.
Safety. Over time, cars that do a good job of protecting drivers and their passengers bring down insurance costs. Fewer injuries mean fewer claims for medical payments and personal injury protection.

The role of age and gender in car insurance costs

Insurance service providers will consider your age when calculating costs. Generally, younger drivers have less experience and are more likely to be involved in collisions than older drivers. As a result, insurers charge more to cover the high risk of settling an accident claim from a young driver. However, middle-aged and senior drivers pay less for car insurance because as you age, you gain more driving experience, practice safer habits, and reduce the risk of filing a claim.

Gender also significantly impacts insurance rates across many states. Women are less likely to cause serious traffic accidents than male drivers. Companies, therefore, charge lower rates to female drivers than their male counterparts.