Why Is Car Insurance So Expensive?

by COUNTRY Financial

You drive the same car the same way you have month after month and year after year, so why is car insurance so expensive? Consider two categories of factors—things you can’t control and things you can. 

Car insurance factors you can’t control

Rising costs of parts and repair

Today’s cars have more technology. Back in the day, a fender bender resulted in a small repair and a small repair bill. Today, you’re replacing more than a bumper. The more bells and whistles a car has, the more it costs to fix.

Increasing medical costs 

When healthcare prices go up, car insurance rate increases are sure to follow. That's because auto insurance can cover medical costs of accident-related injuries, so insurance companies have to adjust their rates if healthcare becomes more expensive.

Where you live

Insurance companies set your rates based on risk; in other words, the chance that certain events may happen. If your geographic area is more prone to these events, your car insurance rates could increase. For example:

• More accidents in your area: More people means more traffic and more accidents. Rates in urban areas will likely be higher than those in rural areas.
• High rates of car theft: Living in an area where vehicle theft is common could contribute to car insurance rate increases. Insurance companies pay claims for car theft, and may need to increase prices to cover the higher risk.

Ways you can help control auto insurance cost, and how to lower car insurance

While you can’t control car repair or healthcare costs, you can take steps to save money on car insurance.

Drive safely

• Maintain a safe driving record: A clean driving record—i.e., avoiding accidents and traffic violations—can help you maintain a lower car insurance premium. Insurance companies reward good drivers with auto insurance discounts. 
• Consider telematics programs like COUNTRY Financial DriverIQ^TM: Using telematics that monitor your driving behavior will not only make you a better driver, but can also save you money. By enrolling in DriverIQ, you'll automatically save 10%¹ on your car insurance. With safe driving, at each renewal your discount can range from 1% up to 25%, based on your driving performance.
• Avoid driving distractions: Distracted driving accounts for a high number of car accidents. According to the National Highway Traffic Safety Administration, the “estimated number of drivers using electronic devices during the day is 660,000.” That includes people who text, snap photos, record videos, and more. The younger the driver, the higher the distraction rates. So, put your cell phone away and encourage your teen driver to do so, too.
  
  You should also do things like reviewing your route and setting your playlist before you begin driving. Keeping your hands on the steering wheel and eyes on the road will improve your driving. 

Choose a safe car—and take care of it

When you car shop, contact your insurance agent before you buy to get the cost of auto insurance. Some cars are more expensive to insure than others and come with a higher insurance premium. Key factors include the actual car cost, safety features, and age of the vehicle. Also, some cars are more often targeted for car theft and, as a result, are more costly to insure.  

Once you have your car, keep up with oil changes, brake repair, tire replacement and other necessary maintenance. A well-maintained car is a safer car and can help keep your driving history clean.

Drive less

Join a carpool with friends or colleagues. You’ll save some gas money, reduce the number of cars on the road and have time to connect with your friends.  

Be sure to report mileage reduction to your insurance agent. One factor in your insurance rates is annual mileage, so you may be able to save by reducing the miles you drive.

Bundle insurance with the same company

When you have your car and home insurance with the same company, you’ll likely qualify for auto insurance discounts. And you could save even more if you add other types of insurance, like life insurance, with discounts like our Multi-Policy Discount. Talk with your insurance agent to see if you’re eligible to move all your insurance to COUNTRY and see if you could save money. 

Keep your credit score high 

People who pay their bills regularly and maintain a high credit score are typically better insurance risks and qualify for better auto insurance rates. Minimize your debt and stay current on your bills to boost your credit score to save on insurance. 

Final thoughts

If you find yourself freqently asking, 'Why is car insurance so expensive?', the tips we've provided are a great starting point. They can help you lower car insurance and take more control over your coverage costs.

Get comfortable reaching out to your insurance agent, too. They'll help answer questions and find discounts you might not have been aware of.

Updated 9-24-25