Auto Insurance Pricing Trends: What Drivers Should Know Going Into 2026

• Insurance prices are stabilizing overall — for low-risk drivers. While the national average full coverage premium dipped slightly by the end of 2025 , that modest relief was mainly concentrated among drivers with clean records. At the same time, minimum coverage premiums rose, signaling that baseline affordability remains a growing challenge even as inflation cools.
• High-risk drivers are not feeling pricing relief. Premiums increased for drivers whom insurers consider higher risk, including drivers with a DUI, low credit, and teen drivers. This widening pricing gap reflects insurers’ shifting away from broad rate hikes and toward more targeted risk-based pricing heading into 2026.
• Rate changes vary among carriers. A handful of large providers lowered prices, helping to reduce average costs overall. Meanwhile, some insurers with double-digit increases still remain below the national average, underscoring the importance of shopping around.
• Shopping strategies can help customers save. Drivers who compare multiple providers, consider telematics, reassess coverage levels, and bundle policies are best positioned to manage costs in 2026.

The widening gap between standard and high-risk pricing is one of the most important trends heading into 2026. Between the first half (H1) and the second half (H2) of 2025…

Drivers with clean records generally saw slight decreases in full coverage rates. The national average annual premium for full coverage dropped from $2,399 to $2,356 between the first and second half of 2025 (a two percent decrease).

Drivers with higher-risk profiles saw significant increases. Price hikes were much sharper for drivers with recent incidents or poor credit. For example, people with a DUI experienced the largest price change, a 35 percent increase. Meanwhile, teen drivers saw rates go up by an average of 17 percent. And the cost of minimum coverage policies (often seen as higher-risk, because they can lead to uncovered losses) rose by 14 percent.

Here’s how national average premiums are changing across different categories as we head into 2026:

These national averages reflect blended pricing estimates across major insurers for standardized driver profiles.

Rate changes vary by provider. A handful of major providers reduced rates, including State Farm and Liberty Mutual. The majority of providers saw premiums go up, though some only slightly.

Although most insurers raised full coverage rates in the second half of 2025, the national average declined slightly because pricing is driven by market-share-weighted effects, rather than a simple carrier count. Rate decreases at several large national insurers, combined with shifts in consumer mix toward lower-cost providers, offset increases among other carriers.

Note that even providers with big increases, like Travelers, Auto-Owners and Erie, still have rates below the national average.

Minimum coverage changes by carrier tended to follow similar patterns to full coverage, with some exceptions.

For example, while Allstate and Erie’s full coverage rates increased on average, their minimum coverage prices dropped slightly.

Conversely, Amica’s full coverage rates dropped, while its minimum coverage rates increased steeply, possibly reflecting a shift in customer market preference.

After several years of rapid increases, auto insurance rates are beginning to level off in many parts of the country.

Insurers have largely completed the major pricing corrections needed to offset the surge in claims costs that followed the pandemic, supply chain disruptions, and record inflation. In other words, companies have regained their profits, and with fewer unexpected shocks entering the system, pricing momentum has slowed.¹

Despite signs of stabilization, auto insurance premiums remain historically elevated.

Rising Claims Payouts

Many insurers continue to report higher costs for repairs, medical payouts, and legal settlements. Modern vehicles are more expensive to fix, particularly those equipped with advanced driver-assistance systems or electric powertrains. Even minor accidents can require costly sensor recalibration or battery-related repairs.² Medical expenses and litigation costs also remain high, especially in bodily injury claims.

Inflation and Parts Costs

Although overall inflation cooled in 2025, auto-related expenses have not returned to pre-pandemic levels. Replacement parts, specialized labor, and longer repair times continue to drive higher claim severities.

In short, inflation may be slowing, but the baseline cost structure of auto insurance has shifted upward, likely permanently.

Increased Claims Costs for High-Risk Drivers

Premium increases have been most pronounced for high-risk drivers, including those with DUIs, low credit profiles, or limited driving histories, as well as teen drivers. These segments experience higher claim frequency and more severe losses, leading insurers to reprice aggressively to avoid underwriting losses.

As insurers refine their risk models and move away from broad increases, pricing pressure is increasingly concentrated among higher-risk profiles rather than evenly distributed across all drivers.

The pace of auto insurance hikes slowed dramatically, dropping from about 13 percent in early 2024 to under 2 percent by the end of 2024. However, drivers still felt the effects of previous premium increases. As a result, car insurance shopping increased, with the percentage of customers searching for new providers increasing from 49 percent to 57 percent.³

Customers are increasingly shopping for car insurance in order to deal with premium hikes and their unpredictability. According to our analysis of approximately 1,100 reviews and forum posts from mid-2024 to late-2025, customers frequently complained about sudden premium hikes of 20 to 50 percent at renewal.

The bottom line is that affordability remains a major concern. Among customers who filed a claim, 44 percent experienced a premium increase, and satisfaction among that group dropped sharply.⁴

As prices fluctuated, customer frustration grew—not only around rates, but also around fairness, claims experience, and communication quality.

According to our analysis, premium increase complaints made up about 20 percent of all negative reviews and carried a 90 percent negative sentiment rating. Interestingly, customer service and claim-handling issues created a comparable amount of negative discussion. Even though pricing is a major pain point, poor customer experience is still a top reason that people switch providers.

Additionally, our telematics survey data indicates that drivers see certain pricing components as unfair:

• 68 percent say credit score use is at least somewhat unfair.
• 72 percent say gender-based pricing is unfair.
• 90 percent say usage-based discounts are fair to use.

Ultimately, while cost drives switching, so does dissatisfaction with claims and customer service.

Compare at Least Four Providers

Since providers have different pricing strategies, your quotes may differ by hundreds of dollars for the same driver profile and coverage level. Compare quotes from several providers to find the cheapest rates for your circumstances.

High-risk drivers now face even steeper premiums for traffic violations or accidents. One provider may increase premiums by 10 to 20 percent for a speeding ticket, while another may hardly increase rates.

Consider Telematics Programs

Because providers are working on expanding telematics programs, you can receive lower premiums if you enroll in usage-based insurance. Make sure you’re comfortable sharing your data before you sign up.

Reevaluate Coverage Levels

In 2025, minimum coverage rates rose sharply, while full coverage rates fell slightly. This means that upgrading your coverage might not cost as much as you expect. Regardless, it’s wise to raise your liability limits above the required minimum (generally to 100/300/100).

Take Advantage of Bundling and Multi-Car Discounts

Buying multiple policies from the same provider is one of the best ways to save on both policies. The most common types to bundle are homeowners/renters and auto. By the same token, if your household has more than one car, insuring them all on the same policy can also save you significantly.

Shop Around — But Not Too Often

Few drivers know that switching your car insurance every six months may end up costing you in the long run. That’s because insurers see drivers who switch too frequently as less desirable, and may consider that in underwriting. Shop every one or two years, when you experience a life change (e.g., marriage, new car), or if your rates increase sharply.

The past six months of pricing data show that the car insurance industry is still recalibrating from the past few years. If you’re shopping for car insurance in 2026, prepare for price volatility, especially if you’re considered high-risk. On the other hand, you’ll likely enjoy lower rates if you have a clean record.

Either way, many providers have stabilized their insurance pricing, so you’ll find better prices if you shop around. We recommend bundling policies, considering telematics programs, and comparing at least four providers to get the best value.

Pricing

To estimate national average premiums, we analyze published rate estimates across major U.S. insurers for standardized driver profiles and coverage levels. These include full and minimum coverage for good drivers with good credit, as well as various driver profiles, including those with DUIs, accidents, low credit, and teen drivers.

Full coverage averages use the following limits:

• Bodily injury liability: $100,000 per person/$300,000 per accident
• Property damage liability: $50,000 per accident
• Uninsured and underinsured motorist bodily injury: $50,000 per person/$100,000 per accident
• Comprehensive and collision: $500 deductible

Actual premiums vary by state, insurer, and individual risk factors; quoted figures should be interpreted as directional benchmarks rather than guaranteed rates.

Customer Reviews Sentiment Analysis

We used GPT-5 Deep Research to systematically collect and analyze approximately 1,100 authentic consumer reviews and forum posts about U.S. auto insurance providers from mid-2024 to late-2025. Platforms included Reddit, TrustPilot, Quora, Bogleheads, and several smaller finance and insurance forums. We intentionally sampled both large national carriers and smaller or regional insurers. Posts that were purely about car accidents without commentary on service, pricing, or coverage were excluded to keep the focus on insurer performance and customer experience.

Limitations and caveats: Online reviews and forum posts tend to overrepresent dissatisfied customers. Even after balanced sampling, the data may still skew negative compared with internal satisfaction surveys or the overall customer base. In addition, some platforms allow anonymity, so identity verification is limited outside of “Verified Buyer” tags.

Telematics Survey

In 2025, we surveyed 1,282 individuals who are in charge of auto insurance for their household, representative of the United States population based on the U.S. Census. Respondents were asked about their opinions and perceptions of fairness and privacy in auto insurance, especially with respect to telematics devices or applications.

We also downloaded the full privacy policy documents for eight leading auto insurance providers to audit the information that they gather and how they use it. We used Google AI Studio to analyze the documents and locate the relevant sections, then manually verified the data within the documents to ensure that there were no errors. See in-depth results in our full article.