The Average Cost of Car Insurance for a Family


Choosing a family auto insurance policy is not always an easy task. Consumers must consider a variety of factors, including marital status, the number of drivers in the household, number of miles driven each week and whether any teen drivers are included on the policy. The premium rates for auto insurance differ depending on a driver's age, gender, and driving record. Where you live and vehicle type affect rates as well. Although many people do not take the time to read their auto insurance policy to find out if any of the terms have changed, you can save money by comparing auto insurance rates to see if you can get a better premium. A practical time is when it comes it's time to renew your current policy.

Average Cost

  • Based on statistics compiled by the Car Insurance Premium Index (CPI), the average auto insurance premium in June 2009 was $1,804 for U.S. households. This is about a 12 percent increase in average costs from the previous year. Premium rates differ from state to state. However, in general, auto insurance premium rates are higher than they were the year before, although in some states the rates have dropped. In 2008, the estimated national average cost for car insurance was $1,600.


  • Most insurance companies offer multi-policy discounts to people who insure all their vehicles and their home with the same company. Some companies give discounts to individuals who do not drink or smoke. Safety features such as airbags or a car alarm in your vehicle can get you more of a discount. Completing a driver safety course may make you eligible for yet another discount. Even certain models of vehicles sometime qualify drivers for discounts, as insurance companies consider that sports cars, trucks and SUVs more likely to be involved in an accident.

    You may be able to reduce your premium rate more by driving fewer miles each week. Riding in a carpool or taking public transportation to and from work or school can add up to savings. Good drivers are rewarded with discounts for not having traffic violations or accidents on their driving records because they are considered good risks. Paying your annual car insurance premium in full could get you a discount, too.

Drop Some Coverage

  • Drivers can do a number of other things to reduce the cost of family auto insurance. Drop the coverage for extras such as towing service or car rental. Frequently, new car warranties include roadside assistance at no cost. If you are covered under a health insurance plan that provides plenty of coverage, think about reducing the medical insurance coverage on your auto insurance policy to the minimum amount required by the laws in your state.

Collision Coverage

  • Consider increasing the collision and comprehensive deductibles on your policy. Increasing a $100 deductible to $1,000 can lower the premium by a few hundred dollars each year. Although you will still have auto insurance coverage, you may have to pay for minor fender benders out-of-pocket. Drop the collision coverage entirely on an older vehicle. Insurance companies limit claims to the vehicle's current book value so you will not get much for a car that is older than seven years. Many drivers decide to drop the collision coverage on their vehicle once a car has high mileage or the annual insurance premium is more than 10 percent of the current value of the vehicle.

Credit Score

  • More insurers are taking a driver's credit score into account when setting family auto insurance rates. Most auto insurance companies now run credit checks before determining a monthly premium. Like people with safe driving records, insurance companies consider people with a good credit history a better risk and that can get you lower insurance rates. Some insurers periodically review credit reports and adjust rates if they see reason for concern. Consumers with credit scores below 650 are likely to pay higher rates or be denied coverage. But the higher your credit score, the lower the risk, and that translates into savings on your car insurance.

Teen Drivers

  • Adding a teen driver to the family's auto insurance policy can be expensive, increasing insurance premiums from 50 to 200 percent. However, high school and college students who make the honor roll or Dean's List usually qualify for a driver's discount of between 10 percent and 20 percent depending on the insurer. You can save another 5 percent to 15 percent if your teenager completes a safe driving course.


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