Drivers who move to California from other states are sometimes surprised at the cost of car insurance in California, and with good reason. California is one of the more expensive states in the country as far as the cost of car insurance goes, and even within the state rates can change considerably.
How much is car insurance in California?
To illustrate just how much variation there is within the state, consider the following table, which breaks down the average annual cost of a premium from 20 cities, towns, and neighborhoods from across California.
|California Town||Average Annual Car Insurance Premium|
These rates are based on a driver profile of a 35-year-old single adult with 100/300/50 liability limits in addition to full coverage with $500 deductibles for collision and comprehensive, a good credit score, and one driving violation in the last three years. These rates are provided by Quadrant Information Services and are rounded to the nearest whole dollar.
As you can see, your annual California car insurance cost if you live in Mount Shasta will be quite different than if you live in Tarzana or Beverly Hills. The average annual premium based on this chart’s data puts the cost of an annual car insurance premium in California to around $2,058 per year. However, this data leads many people to ask why the rates can vary so much and why they are still fairly high, even in areas that are less expensive than the average.
What affects California car insurance rates?
Many factors affect car insurance rates, but if there’s one factor that overrides all others in determining rates for drivers in California, it’s the sheer number of drivers in the state. Population numbers do impact car insurance rates; where there are more people and more cars, there are bound to be more accidents.
Californians also like to use their cars. There are many reasons that people choose to use their own vehicles rather than public transportation, including convenience and whether or not public transportation can efficiently get them to their final destinations.
With a state as geographically large as California is, your options to get from one place to another using public transportation are limited. As a result, many Californians use their own vehicles, even for short trips. As with the population factor, this means more cars on the road, and more cars generally means more accidents.
California is also an expensive state in which to live, which drives up car insurance costs in an interesting way. Since the cost of living is high in California, particularly housing costs, people try to save money wherever they can. For some, that means getting a bare-bones car insurance policy. In California, others don’t purchase any car insurance at all. This then means that many Californians are driving uninsured or under-insured, which has an impact on the rates that all drivers in California pay.
How can I get cheap car insurance in California?
Although California’s car insurance premiums are higher than those found in many other states, there are still ways to find cheaper rates on car insurance.
Shop around in California: How will you know you’re getting the best rate possible if you don’t shop around a bit for insurance in California? While spending time researching car insurance rates might seem like a large time investment, it is the best way to find out what rates are in your area in California and to see if there are any bargains.
Broaden your search of insurance providers in California: Don’t restrict your search for cheaper car insurance rates in California to just the big companies that you’ve seen advertised. There are many, many options available, so broaden your search to include online options and local or regional carriers. Getting 3+ quotes can increase the likelihood that you’ll get the best rate for your California insurance needs.
Ask about car insurance discounts in California: Insurers like to encourage people to have multiple policies through one company. This increases revenue and reduces the likelihood that customers will hop over to another carrier if there’s a price increase. To make the purchase of multiple “lines” more attractive, insurers will reduce rates on policies. The more policies that you have with a single insurer, the more that you can save. This is called “bundling.” So, if you are happy with your homeowners policy and your insurance provider also offers car insurance, then give them a call to see if there are any bundling discounts available to you.
Be a good insurance customer in California: Yes, this one will only offer savings over time, but it’s important. Pay your premiums on time and in full, and be a consistently good driver in California.
If you can, consider increasing your deductible: Increasing your deductible, the portion of payment after an accident that you are responsible for paying, can decrease your premium amount. However, it’s important to take your personal finances into account when settling on a deductible. Be honest with yourself, and pick a deductible amount that is rational and realistic. Picking a very high deductible in order to get a low insurance premium rate could end up being a problem if you are in an accident and cannot afford to pay your deductible to get your car fixed.
Are you in the military? California is home to a number of military bases and has one of the highest populations of active-duty military members in the country. If you are in the military, you might be eligible for car insurance through USAA (USAA profile | USAA articles, which can be a reasonable and inexpensive option for those serving.
As you search for cheap car insurance rates in California, keep in mind that the best insurance in California is insurance that provides adequate coverage, and coverage that you are happy with. A cheap policy can quickly lose its attractiveness if you find yourself arguing over coverage or if you become frustrated with poor customer service. For that kind of detail, take a look at how other customers rate their insurers on our website.
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