ST. LOUIS — Even though inflation is slowing down, car insurance costs are increasing at a rapid speed. According to Bankrate’s latest report, the national average cost for full coverage car insurance is more than $2,500 a year – up from a little more than $2,000 in 2023 and roughly $1,770 in 2022.
Sherry Liess is a retired food chemist, but even as a scientist, she got stumped by her insurance company’s math formula that determined her new bill.
“When I got my car insurance notification last month, they told me that my policy had gone up to $1,628.40,” said Liess. “I almost had a heart attack.”
Liess says that was only half of the battle – since then her insurance rates when up to nearly $3,000 a year and for no good reason.
“A year ago now, it was only $740 –so why is it almost tripled?” asked Liess. “I was just like, ‘Wow, I'm retired. We're retired.’ It was ridiculous to be paying that kind of money.”
Many 5 On Your Side viewers have reached out over recent weeks complaining of similar stories of skyrocketing car insurance bills without having a claim.
“This is based on just a series of events that happened in a really short period of time,” said Shannon Martin, a Bankrate Analyst who wrote the report mentioned above. Martin says several factors contributed to these rate hikes – inflation, a nationwide jump in car thefts, a 10 percent increase in car crash deaths, and an increase in the cost of parts.
Martin says there are a few things you can do to save money, like getting rid of items you don’t need.
“Towing and lockout, gap coverage, rental reimbursement– those are extras that we can have when we have the money for them,” reminded Martin. “You don't need them for your car to be legally insured.”
Liess spent a good chunk of time creating her own spreadsheets and making calls to insurance companies to compare rates. She has her own advice to give on cost savings.
“You do automatic payments, there's a discount. If you do re-registration for next year, you save money,” said Liess. “And if you pay in full, you save money.”
In Liess’ case, time was money, but it didn’t come easy.
“I guess it's worth it for the time, but still, it just seems like a lot of work,” said Liess. “I don't think it should be this difficult.”
The cost of yearly car insurance also depends on where you live. For example, Bankrate says Detroit drivers are facing an average annual expense of more than $5,600 a year, which is roughly 8% of an annual median household income.
If a driver has a poor credit score, they’ll also pay more money. And if you have teen drivers, your auto insurance is also expensive, up more than 23% from 2023.