Why can’t I find cheap car insurance?

Finding cheap car insurance can be affected by your driving record, your vehicle, where you live, and how long you've been a driver. Compare rates to find the cheap car insurance you're looking for.

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A former insurance producer, Laura understands that education is key when it comes to buying insurance. She has happily dedicated many hours to helping her clients understand how the insurance marketplace works so they can find the best car, home, and life insurance products for their needs.

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Joel Ohman is the CEO of a private equity backed digital media company. He is a CERTIFIED FINANCIAL PLANNER™, author, angel investor, and serial entrepreneur who loves creating new things, whether books or businesses. He has also previously served as the founder and resident CFP® of a national insurance agency, Real Time Health Quotes. He has an MBA from the University of South Florida. Jo...

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Reviewed by Joel Ohman
Founder & CFP®

UPDATED: Sep 16, 2021

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Here's what you need to know...

  • Your driving record could affect your car insurance rate
  • Newer cars can drive up the price of your car insurance
  • How long you have had your license can cause high car insurance rates
  • The area you live in could keep you from finding cheap car insurance

Getting some outrageous car insurance quotes? You’re not going to be alone; many people are unable to get cheap quotes from insurers right off the bat. There could be many factors keeping you from finding cheap car insurance.

Don’t let a few high auto quotes halt the process of you getting coverage. There are competitive rates out there, it just takes a little time and research to find them. And don’t just look at one or two insurers, look at many! That’s the best way to find affordable rates across the board. Compare rates side-by-side to make sure you’re not overpaying.

Did you buy a new car?

Are you shopping for new insurance quotes for the new car you just recently purchased? If the answer is yes, then unfortunately with the type of coverage you’re going to need, you should expect to pay a little more than if you had purchased a used vehicle. An auto policy is no cheap thing, and it’s going to be even less cheap the newer your car.

It’s not likely that you’ll find cheap auto insurance on a newer model car. New car parts are more expensive to replace than older model parts.

That, and the average costs with most major insurers are going to be a little higher on new models because they’re much more expensive to replace should someone get into an accident. Plus, with new cars, the coverage policies out there are a little different. You’re expected to want to protect a new car in ways that an older car may not need.

For example, a new car is going to want to have both collision coverage and comprehensive coverage. The first protects the vehicle in case of an accident, the second protects your car against any acts of weather or vandalism. Some people choose not to have any optional coverage that an insurer offers, but rather they end up going with the minimum coverage required by their state.

A good way to help cushion the blow is to mention all the safety features your new ride has. That way your insurance company can see what kind of vehicle safety discounts are available to you. They won’t know unless you tell them! Those safe driver discounts could help you save a little bit of money in the long run.

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Are you a new driver?

Being a new driver doesn’t necessarily mean that you are a young driver. There are some adults who don’t or can’t get their driver’s license until later. The downside to this is that you have less driving experience under your belt, thus higher insurance prices. Reason being is that both new and teen drivers tend to be seen as driving liabilities, since they haven’t been on the road as long as someone who got their license as soon as they could.

The good new is that as you have had your license longer, you will see a decrease in the price of your car insurance.

Car insurance rates are not friendly to those who are under 25, as you may already be finding out. Even if you have a clean driving record and good credit, you may be having a hard time finding a decent rate.

There isn’t much you can do except wait it out. If at all possible, look into getting on a parent’s policy or someone who is an experienced driver. If you’re a student, you can also ask if there’s any sort of student discount which would offset the higher annual cost you’d be quoted.

Another little helpful hint is that you may want to inform your provider or the providers you’re looking into if you are married. A lot of people don’t realize that your marital status can affect personalized quotes, but it does! Married couples can join policies and receive a multi-car discount which will help with some savings!

Have you recently been in an accident?

Having an accident on your driving record can drastically increase your car insurance rates. The amount of increase depends on the company and whether or not you were at fault for the accident.

  • At-Fault Accidents – Being at-fault in an accident can have the biggest impact on your driving record. The length of time that this will affect your insurance rate varies by company, but it usually affects your rate for five years.
  • Not-At-Fault Accidents – Even if the accident wasn’t your fault, your insurance could still be affected. This is when comparing insurance quotes is really important. Every company surcharges for not-at- fault accidents differently. There are some that may not penalize you at all.

Shop around, see what other companies have to offer. If you want to take some preventative measures, see about adding accident forgiveness to your current car insurance policy.

Do you have any violations on your record?

Good drivers benefit from savings on their car insurance. If you have had any tickets or driving violations on your record within the past few years then it is most likely affecting your insurance rate.

While good drivers receive discounts, drivers with violations sometimes receive surcharges. A surcharge is a charge over and above your insurance premium. The surcharge will vary depending on the type of violation and the insurance company.

The good news is that once those violations fall off of your record, you are eligible for good driving discounts.

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Where do you live?

Location, location, location! It’s all about where you live when breaking down insurance rates. If you live in a busy city or an area that has high accidents and vehicle theft, you are going to be paying more for your insurance. Average premiums are usually based heavily off of population and what percentage of said population is driving.

Those who live in rural areas usually enjoy the lowest car insurance rates.

This isn’t to say that you’ll never find affordable options in the area you live in. You may simply need to make sure your provider knows about all the factors in your life that could also affect your rates. Let them run credit reports, tell them if you have a clean record, and most importantly let your provider know that you’re shopping around. It’s a highly competitive market; chances are they won’t want to lose you as a customer.

If you are considering moving, price out some insurance quotes in a neighborhood you’re looking into. It’s not always possible to choose where you live but if you can, you can save yourself a lot of unexpected premium!

Is your credit score low?

Yes your credit score can affect your monthly rates. Not every company has the same scoring model, but your credit history is important in determining what an insurance company may charge you.

Not all car insurance companies will allow bad credit to stop them from providing you with a quote for what your average rates might be, so if your score has taken a plummet, do some shopping around! And from there it’s all uphill. The better your credit, the lower your annual rates. Once your credit is rebuilt, the insurance world is your oyster!

What’s the bottom line?

There are many factors that go into determining your car insurance rate. The lowest rates are going to go to safe drivers, those who have experience behind the wheel, and those who have older vehicles. If you are having trouble finding decently priced car insurance, don’t be afraid to ask questions.

A great way to jump in is to look at online quotes. Take a look at what common discounts are offered across the board, and use that competitive market to your advantage. Insurance companies and agents can be incredibly knowledgeable, and can help you figure out what you need to do to get your insurance rates lower.

You may not be able to find the cheapest rates right now, but it’s possible that with some work you can pay a lower price in the future.

Enter your zip code below and see how much you could be saving on auto insurance.

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Enter your ZIP code below to view companies that have cheap car insurance rates.

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