SoFi

Should you get into a car accident and harm someone else or yourself with your car, your car insurance may cover the costs of medical bills. Depending on the coverage included in your policy, car insurance could also cover damage to your car while it’s parked, like if a large tree branch were to fall on it.

Ultimately, what your auto insurance will cover — and how much — depends on what type of car insurance you have and the amount of coverage you select. Read on to learn more about how exactly auto insurance works.

How Car Insurance Works

When you purchase auto insurance, you can choose different types of insurance and policy amounts. Depending on the state where you live, there are certain car insurance requirements you’ll need to meet — more about this later on.

Adding more types of insurance and higher coverage limits provides greater coverage, but it also raises your premiums. Having a lower deductible can also bump up your rates. On the other hand, a higher deductible can lower your rates.

A deductible is a common auto insurance term that means how much you would need to pay upfront before insurance coverage kicks in.

Recommended: How Does Car Insurance Work?

Car Insurance Requirements

Most states require car insurance, with the type of insurance and minimum coverage amounts depending on the state.

The only state that does not require car insurance is New Hampshire. While auto insurance is not mandatory in New Hampshire, if you’re at fault in an accident, you would need to show that you have enough funds to meet the state’s motor vehicle financial responsibility requirements.

If you’re not sure what the minimum requirements for car insurance are where you live, you can check your state’s DMV site. Keep in mind that while you can squeak by with the minimum coverage, how much car insurance you need varies. Depending on your situation, it may be a good idea to get more coverage.

Types of Car Insurance

When comparing car insurance, there are six main types to keep in mind.

Bodily Injury Liability

If you get into a car accident and are found to be at fault, bodily injury liability coverage can help cover medical bills and wages lost for taking time off of work because of bodily harm. It can also cover named drivers, such as family members on your policy or drivers who are using your car with your permission.

Bodily injury liability is typically must-have coverage. According to the most recent data available from the Insurance Information Institute (III), the average claim for bodily injury was $26,501 in 2022. Having enough coverage could help protect your property, assets and home.

Collision

If you crash into another car or an object, or your car gets damaged from driving over a pothole, collision coverage can pay for the costs to repair any damages to your car. It can also cover damages should your car flip over. Once your deductible is paid, the coverage will kick in.

If the other driver is the one at fault, then typically a claim can be filed with their insurance company and they’ll cover the costs. In the case the other driver’s coverage amounts aren’t enough, and you don’t have uninsured motorist coverage (sometimes called underinsured coverage), then your own collision policy can step in.

If you’re taking out a loan and still paying off your car, lenders likely require you to have full coverage, which includes liability, collision, and comprehensive insurance.

Recommended: How Much Does Insurance Go Up After an Accident?

Comprehensive

While collision coverage can cover the costs of damage during a car crash, comprehensive liability includes everything else — like a deer running into the front of your car, riots and vandalism, a tree branch falling on your car, or a hail storm or other natural disaster. Comprehensive coverage can also pay for a broken windshield (though whether it makes sense to file a claim depends on your policy and deductible). It can also cover theft, of either your entire car or a piece of your car, such as a hood ornament.

As mentioned before, if you’re still making payments on your car, you most likely are required to have both comprehensive and collision insurance in addition to liability coverage.

Personal Injury Protection (PIP)

Should you, the driver, or your passengers get harmed in a car accident, personal injury protection (PIP), also known as medical payments coverage, can help pay for medical bills, lost wages and sometimes funeral costs. It can cover these costs no matter who is at fault, hence why it’s sometimes called no-fault insurance.

Depending on your policy, PIP can also help pay for bodily harm should you get injured while walking or riding a scooter or a bike.

Property Damage

Like bodily injury liability, property damage coverage is also usually required in most states. Let’s say you or a named driver on your policy damages another vehicle or property, such as the side of a building. In these situations, property damage can reimburse the cost of repairs.

Uninsured or Underinsured Motorist

In the case of a hit-and-run, uninsured or underinsured motorist coverage can foot the bill for covered damages. Or, should someone who hits you not have adequate insurance, this type of policy can help pay for any shortfalls.

Special Considerations When Choosing a Policy

Besides the standard types of policies, there are some additional considerations to keep in mind when it comes to choosing an auto insurance policy.

Roadside Assistance

While not a type of insurance, roadside assistance can come in handy should you get a flat tire or your battery dies while on the road. While you can usually attach this to your existing auto policy as an add-on, what exactly is covered might vary by carrier.

Outside of purchasing roadside assistance as an add-on to your car policy, you can also shop around for companies that offer roadside assistance as a standalone service.

New Car Replacement Coverage

If your new car gets totaled, new car replacement coverage can replace the vehicle in its entirety. This is usually available as an add-on if you purchased a policy with collision and comprehensive insurance.

Depending on the insurance company and carrier, this might cover cars that are no more than two years old. Plus, restrictions and limitations might differ.

Rental Reimbursement Coverage

If your car is getting repaired and those repairs are covered under a car insurance claim, a policy might include an add-on to cover the fees for getting a rental car or other transportation while your vehicle is in the shop. Whether you take public transit, rent a car, or take a rideshare, what exactly is covered depends on your specific policy and limits.

Rideshare Coverage

If you’re a rideshare driver for a company like Uber or Lyft, you’ll need to meet the minimum coverage amounts for that particular company. Some insurance companies provide rideshare coverage in their policies. If not, you might need to get a rideshare endorsement or a separate rideshare insurance policy.

Car Rental Coverage

If you have liability and comprehensive coverage on your car, then that coverage can typically carry over to when you rent a car within the country. As mentioned before, depending on the particulars of the policy and car insurance company, this might not be applicable in every state, and the amount of coverage can also vary.

What Does Car Insurance NOT Cover?

While auto insurance can cover a lot of things, it doesn’t cover normal wear and tear or routine maintenance. And unless it’s a rental car, it doesn’t provide coverage when you’re driving someone else’s car.

A policy also doesn’t pay for lost personal belongings in your car, such as headphones or gym gear. This could be covered by a homeowners or renters insurance policy.

At the end of the day, not all policies are alike nor are they created equally. It’s important to check to see what your policy will cover.

The Takeaway

There are six main types of insurance: bodily injury liability, collision, comprehensive, personal injury protection, property damage and uninsured or underinsured motorist coverage. The type of coverage and limits required vary by state. When choosing a policy, you’ll also want to consider whether additional coverage like roadside assistance, car rental coverage, or new car replacement coverage is right for you.

Taking the opportunity to compare car insurance companies before committing to a policy can be a smart move that might save you money on your insurance rate.

When you’re ready to shop for auto insurance, SoFi can help. Our online auto insurance comparison tool lets you see quotes from a network of top insurance providers within minutes, saving you time and hassle.

SoFi brings you real rates, with no bait and switch.

---

Photo credit: iStock/tommaso79

Auto Insurance: Must have a valid driver’s license. Not available in all states.
Home and Renters Insurance: Insurance not available in all states.
Experian is a registered trademark of Experian.
SoFi Insurance Agency, LLC. (“”SoFi””) is compensated by Experian for each customer who purchases a policy through the SoFi-Experian partnership.


Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOPRO-Q225-022

Read more

Congrats, new driver: Hitting the open road on your own can mean freedom and just plain fun. But remember that safety comes first — and part of driving safely is having sufficient car insurance coverage.

The world of auto insurance can be confusing, especially for new drivers, who also often face the challenge of higher insurance premiums. Still, there are ways to save money on insurance, both right off the bat and as you spend more time behind the wheel.

Here’s what new drivers need to know about auto insurance.

Car Insurance: The Basics

First things first: What is auto insurance, how does it work, and why do you need it?

Car insurance pays out money for car repairs, medical bills, and other expenses in the event you get in an accident. Liability insurance, which pays out money to the other driver when you’re found at fault, is legally required in most states.

The amount of auto insurance you need depends on the law in the state where you live as well as your own risk tolerance level. But keep in mind that even minor auto accidents can be very costly, which makes auto insurance a necessity.

Unfortunately, auto insurance can be more expensive for new drivers — but again, take heart. There are still ways to ensure you get the best possible rate.

Factors That Affect Car Insurance Price

Car insurance prices are affected by far more than just a driver’s experience level, though that’s certainly an important part of the equation. Here are some other factors that insurers will take into account when drawing up your quote:

•  Driver’s age

•  Driver’s gender

•  Driver’s marital status

•  Driver’s history of accidents and damage

•  Driver’s credit score

•  The primary location where the vehicle is kept and driven

•  The vehicle’s make, model, and age

Although there are some general rules that hold true — for instance, that people with lower credit scores or worse driving records end up with higher premiums — the way some of these factors are used is less than transparent. For example, a 2025 study by the insurance comparison site The Zebra found that in most states, men pay higher insurance costs than women.

For example, a 2023 study by QuoteWizard found that women actually pay higher insurance costs than men on average in many parts of America. This is despite the Insurance Information Institute’s claim that women tend to have fewer accidents than men and therefore pay less for insurance.

While there’s no easy way to predict what your rates will look like without getting a custom quote, new drivers will likely need to prepare for higher insurance premiums. This makes sense. After all, the insurance company is trying to hedge its bets that you won’t get in an accident (and therefore need an expensive claim paid out), and they don’t have a driving record to rely on while they make their best guesses.

Recommended: Auto Insurance Terms, Explained

Who’s Considered a New Driver?

Although the classic image of a new driver might be an eager teenager with their brand-new license and the family’s hand-me-down car, there are other people who fit the description, too. Drivers considered “new” include:

•  Teenagers with new driver’s licenses

•  Adults without a driving record

•  People with a gap in their driving history or car insurance coverage

•  Immigrants to the United States, whose driving records might not transfer over from their country of origin

Being a new driver doesn’t change how much insurance you’re required to purchase by state law. But as mentioned, it can affect your price — so let’s take a closer look into solutions for each type of driver.

Car Insurance for Teens

Teens — or, in many cases, teens’ parents — face some of the highest insurance costs out there because, let’s face it: youthful abandon and lack of experience can lead to accidents. There are some moves you can make to minimize the costs, including:

•  Staying on a parent’s policy: Staying on a parent’s policy as long as they’re living under the same roof can keep costs relatively low for teenage drivers. However, parents should still expect their policy cost to double.

•  Looking for discounts for good grades or defensive driving classes: Teens may also be able to score good student discounts by maintaining above-average grades in school, or get a discount if they attend and complete an approved defensive driving class.

•  Maintaining a good driving record: For all drivers, an accident-free driving history goes a long way toward lowering insurance costs over time. Of course, practicing care and vigilance on the road is always of paramount importance. But given how high the cost of teenagers’ insurance policies can be, there’s even more incentive.

Recommended: How Does Car Insurance Work?

Car Insurance for People Who Moved to the U.S.

Even if you have a robust driving history in your home country, if you immigrate to the United States, it’s unlikely to transfer over. This means you could face elevated insurance prices for the first few years you’re a U.S. driver.

The first step to attaining U.S. car insurance in most states is to acquire a U.S. driver’s license, which on its own can be difficult without the proper paperwork. However, certain states do offer driving privileges to unauthorized immigrants. You may need to provide documentation, such as a foreign passport or birth certificate, and the resultant license is not valid as federal identification.

Once you’re ready to shop for car insurance, consider obtaining several quotes to see which company can offer the basic auto insurance coverage you need for the least amount of money.

Car Insurance for Adults Without a Driving Record

Maybe it’s been a long time since you’ve driven — or you’ve never driven at all.

Without a solid, recent driving history, car insurance companies will still consider you a new driver, which can push costs up. Same goes for having a gap in car insurance coverage. (There may be exceptions to this rule if your driving gap was due to military deployment status, so be sure to check with your prospective insurer.)

Shopping around for the best quote and maintaining as clean a driving record as possible going forward will help your case considerably. If you’re confident in your driving ability and you’ve built up the savings to afford it if an accident does occur, choosing a higher deductible could also help you save money on monthly premiums.

3 Ways to Save on Car Insurance for New Drivers

Along with the tips we’ve included in the sections above, there are some universal suggestions that can help most new drivers — and, in fact, most drivers, period — lower their car insurance costs.

Choose Your Car Wisely

Certain cars are more expensive to insure than others, including flashy models that are likely to get stolen (or tempt their drivers into three-digit speeds). You can find lists of the cheapest cars to insure online, but generally speaking, slightly older, more modest vehicles are the least expensive to keep insured.

Improve Your Credit History

It’s incredible how many parts of our lives credit history touches — and car insurance is no exception. While your quote is drawn up based on many factors, as mentioned above, your credit history is definitely part of it. Besides, maintaining good credit behavior is highly likely to help you elsewhere, too.

Bundle Up

Many insurance companies offer discounts to people who “bundle” coverage or purchase more than one type of insurance from the same company. So if you’re required to have renter’s insurance or have home insurance, see if buying them all from the same provider might save you some dough.

The Takeaway

The price of car insurance is impacted by several factors, including the driver’s age, gender, marital status, credit score, and history of accidents and damage. Just as important is their experience level. Newer drivers and drivers with large gaps in car insurance coverage often end up paying higher premiums — at least at first. However, there are ways to potentially lower costs, including driving a more modest vehicle, bundling coverage, and improving your credit score.

Whether you’re a first-time driver or a seasoned pro, shopping around for insurance in your area can help you figure out how much coverage you really need and what your premium might be.

When you’re ready to shop for auto insurance, SoFi can help. Our online auto insurance comparison tool lets you see quotes from a network of top insurance providers within minutes, saving you time and hassle.

SoFi brings you real rates, with no bait and switch.

---

Photo credit: iStock/SolStock

Auto Insurance: Must have a valid driver’s license. Not available in all states.
Home and Renters Insurance: Insurance not available in all states.
Experian is a registered trademark of Experian.
SoFi Insurance Agency, LLC. (“”SoFi””) is compensated by Experian for each customer who purchases a policy through the SoFi-Experian partnership.


Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOPRO-Q225-018

Read more

Those moments right after a car accident deliver some of the worst stress imaginable. You’re figuring out if anyone is hurt and how bad your car’s been damaged. And before too long you’re asking yourself this stomach-churning question: “How much will my insurance go up after an accident?”

There are many factors at play, including who was at fault, how serious the injuries and damage, your driving record, what state you live in, and the policies of your chosen insurance company.

Understanding these factors and digging into the forces controlling car insurance rates can help you pursue the best options possible.

Why Do Rates Go Up After an Accident?

Auto insurance is a highly competitive business, and that competition plays a role in keeping rates low. But it also means that when an accident happens, there can be quite a jump in what you pay for coverage.

When you’ve had a car accident and you are at fault, your insurer now assumes you drive in a way that could cause an accident. That may sound unfair, but that’s part of how car insurance works. They are assuming a higher risk, and that is passed on to you in the form of a higher rate.

If you are found not at fault in the accident, your insurance rate may go up by a small percentage. California and Oklahoma are two states, however, that mandate insurance companies cannot raise insurance rates after an accident where the driver was not at fault.

This is yet another reason why it’s important to go over policies carefully when making your choice. It’s smart to compare the rates among top insurers and even look at how much insurance increases after an accident with various insurers.

There is one bright spot in the insurance landscape when dealing with an accident. If your insurer offers and you elect to pay for accident forgiveness, your insurance rate will not go up after your first at-fault accident. Driving record and driving experience requirements must be met before this benefit is available.

Recommended: Auto Insurance Terms, Explained

Average Rate Increases by State

After an at-fault accident, yes, your car insurance is likely to go up. Rates can increase by about 45% a year on average after an accident, according to 2025 MarketWatch research. But as the analysis below shows, just how much your rate jumps can depend on the state in which you’re insured.

Average Car Insurance Rate Increase After an At-Fault Accident
State	Average rate with a clean driving record	Average rate after one at-fault accident	% increase
Alabama	$1,775	$2,498	41%
Alaska	$1,685	$2,248	33%
Arizona	$2,008	$2,938	46%
Arkansas	$2,038	$3,001	47%
California	$2,313	$4,085	77%
Colorado	$2,173	$3,040	40%
Connecticut	$1,919	$2,699	41%
Delaware	$2,881	$3,893	35%
Florida	$3,244	$4,608	42%
Georgia	$1,973	$2,931	49%
Hawaii	$1,656	$2,306	39%
Idaho	$1,402	$2,057	47%
Illinois	$1,541	$2,193	42%
Indiana	$1,587	$2,333	47%
Iowa	$1,563	$2,086	33%
Kansas	$1,918	$2,924	52%
Kentucky	$2,522	$3,655	45%
Louisiana	$3,040	$4,423	45%
Maine	$1,238	$1,796	45%
Maryland	$1,833	$2,958	61%
Massachusetts	$2,430	$4,403	66%
Michigan	$3,643	$5,204	43%
Minnesota	$1,766	$2,528	43%
Mississippi	$1,658	$2,603	57%
Missouri	$2,104	$2,992	42%
Montana	$1,979	$2,848	44%
Nebraska	$1,871	$2,679	43%
Nevada	$2,788	$4,112	47%
New Hampshire	$1,362	$2,088	53%
New Jersey	$2,513	$4,127	64%
New Mexico	$1,943	$2,720	40%
New York	$2,088	$2,863	37%
North Carolina	$1,627	$2,756	69%
North Dakota	$1,916	$2,431	27%
Ohio	$1,599	$2,341	46%
Oklahoma	$2,278	$3,066	35%
Oregon	$1,925	$2,945	53%
Pennsylvania	$1,981	$2,820	42%
Rhode Island	$2,357	$2,605	11%
South Carolina	$1,845	$2,496	35%
South Dakota	$2,291	$3,300	44%
Tennessee	$1,524	$2,227	46%
Texas	$2,205	$3,365	53%
Utah	$1,928	$2,855	48%
Vermont	$1,199	$1,722	44%
Virginia	$1,781	$2,636	48%
Washington	$1,616	$2,320	44%
West Virginia	$2,177	$3,195	47%
Wisconsin	$1,694	$2,516	49%
Wyoming	$1,702	$2,305	35%

Source: MarketWatch

How Do I Keep My Rates Low After an Accident?

If you’ve had a car accident, there are some things you may be able to do to keep your car insurance rates from rising.

First, explore discounts that you may have overlooked. Check with your insurer to make sure you’re receiving discounts you’re eligible for.

•   If you haven’t already signed up for paperless billing, now might be a good time to take advantage of the discount you may receive with this option.

•   The number of miles you drive annually is one factor that goes into calculating your insurance rate. Check with your insurer to make sure your rate correctly reflects your annual mileage.

•   Consider a usage-based insurance that tracks different elements of your driving habits and sets your rate accordingly. Better driving habits typically equate to lower rates.

•   Ask about multi-policy discounts if you have all your policies with one insurer.

•   Check into military and government employee discounts.

Another tactic that might be worth pursuing if you’ve had an accident but are looking for ways to decrease your car insurance rate is to increase your deductible. The higher your deductible, the lower your premium.

Look into how much insurance you’re carrying on the car. It’s worth your time to determine how much coverage you need. If your car is worth less than the deductible plus your annual total for car insurance, it could be time to rethink your coverage.

And another thing to scrutinize is what kind of car you drive. Some cars are cheaper to insure than others.

When Does Car Insurance Go Down After an Accident?

Generally speaking, it takes three to five years for car insurance to go down following most at-fault accidents. The insurers are going by the statistical wisdom that if you’re in one accident, the chances are higher that you will be in another. Some insurers also take into account the seriousness of the accident and whether impaired driving was a factor in the accident.

One tactic people employ to lower their rates is to shop around for a new insurer. While the record of the accident and claim will be visible to a second insurer, you may still be able to get better deals.

Your insurance rates will also be affected by your credit. Merely being involved in an accident will not damage your credit, but an improvement in your credit score can be used as leverage in getting a lower premium.

Don’t rule out getting a brushup on your driving to improve those skills. Some insurance companies will discount your rates if you complete a defensive driving or driver education course.

Recommended: Car Insurance Guide for New Drivers

The Takeaway

that can seem hard to figure out. Rates can go up by about 45% a year on average after an accident. But that figure may fluctuate depending on a variety of factors including who was at fault, the seriousness of the accident, your driving record, and to a surprising degree, the state in which you live.

Taking the opportunity to compare car insurance companies before committing to a policy can be a smart move that might save you money on your insurance rate.

When you’re ready to shop for auto insurance, SoFi can help. Our online auto insurance comparison tool lets you see quotes from a network of top insurance providers within minutes, saving you time and hassle.

SoFi brings you real rates, with no bait and switch.

---

Photo credit: iStock/simpson33

Auto Insurance: Must have a valid driver’s license. Not available in all states.
Home and Renters Insurance: Insurance not available in all states.
Experian is a registered trademark of Experian.
SoFi Insurance Agency, LLC. (“”SoFi””) is compensated by Experian for each customer who purchases a policy through the SoFi-Experian partnership.


Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOPRO-Q225-020

Read more

If you’re considering buying your first truck, you may be wondering how much the insurance is going to run. While the cost of insuring a truck varies based on a few factors, the national average is $2,160 per year. (By comparison, the national average for car insurance is $2,790.)

Keep reading for more insight into how much truck insurance costs, and how to lower your premiums.

Differences Between Auto, Truck, and Commercial Truck Insurance

There are really only two types of auto insurance. The type of auto insurance you need depends on what purpose you’ll use your vehicle for.

•   Personal auto insurance. If someone wants to buy or lease a truck for personal use, then they’ll need a personal auto insurance policy. This may be referred to as auto insurance or truck insurance.

•   Commercial auto insurance. Companies that use cars and trucks for business purposes need this policy instead.

Both types cover property damage, bodily injury, and legal expenses related to auto accidents. Commercial auto insurance takes coverage a step further, usually featuring higher claim amounts and protection against more complex legal issues.

Keep in mind that each state has its own rules about car insurance and what it should cover. If you’re unsure what the minimum requirements are where you live, you can check your state’s DMV site.

Recommended: Does Auto Insurance Roadside Assistance Cover Keys Locked in a Car?

How Much Does It Cost to Insure a Truck?

Exactly how much is insurance for a pickup truck? The average annual cost of personal auto insurance for a truck is $2,160.

The typical cost of commercial truck insurance depends on the type of business. Transport truckers haul general freight, such as automobiles, food, and products for retail stores. Specialty truckers cover a single type of freight, like logs or garbage. The average monthly premium for commercial insurance is around $1,000 for specialty truckers, and $650 for transport truckers.

Does It Cost More to Insure a Truck or Automobile?

It isn’t necessarily more expensive to insure a truck over a car. In fact, it’s generally cheaper to insure a truck than some other types of cars, such as electric vehicles or luxury SUVs.

One exception is the age of the driver. College students may have a harder time finding affordable car insurance for their truck.

Average Cost of Car Insurance for Truck by Make and Model

How much is insurance for a new truck? Below are the average monthly rates for 10 of the least (and most) expensive trucks to insure, per Insure.com. You may figure out at a glance whether it’s worth switching car insurance companies.

Make and Model	Average Monthly Premium	Average Annual Premium
Ford Maverick	$146	$1,746
Ford Ranger	$155	$1,864
Nissan Frontier	$157	$1,885
Toyota Tacoma	$160	$1,917
Hyundai Santa Cruz	$162	$1,941
Ford F-350	$196	$2,347
Ram 3500	$203	$2,434
Nissan Titan XD	$205	$2,464
Ram 1500 TRX	$214	$2,565
Ford F-450	$251	$3,010

Make and model aren’t the only things that determine auto insurance prices. For example, first-time drivers are more likely to pay more for auto insurance.

What Is the Cheapest Pickup Truck to Insure?

Many factors can impact the cost of car insurance, such as the type of deductible you choose and the make and model of your car. Generally, the Ford Maverick is one of the more inexpensive pickup trucks to insure with an annual average full coverage rate of $1,746, according to Insure.com.

It’s important to note that even if someone chooses a model that is known to be inexpensive to insure, their personal driving history impacts the insurance rate they’re offered. A driver with a clean record typically will get a better rate, whereas the same insurance goes up after an accident.

Recommended: How to Calculate Expected Rate of Return

Cheapest Car Insurance Companies for Trucks

It’s always a good idea to shop around to get several quotes. You can include traditional insurers and online insurance companies. This will give you a good idea of which companies offer the most complete coverage and affordable rates.

There are several ways to lower your car insurance, but the easiest may be to choose a higher deductible. The following companies offer the lowest annual rates for car insurance, per U.S. News:

Insurer	Annual Premium
USAA	$1,335
Erie	$1,532
Auto-Owners	$1,619
Nationwide	$1,621
GEICO	$1,778
American Family	$2,170
Farmers	$3,253
Allstate	$3,374

Before shopping for quotes, it’s helpful to brush up on car insurance terms to better understand what type of coverage each provider is offering.

Truck Features That Impact Insurance Costs

Truck features don’t directly impact the cost of insuring the vehicle — unless they increase the overall cost of the car. Generally speaking, the more expensive a truck is, the more it costs to insure.

Any features that increase the likelihood of theft or the cost of maintenance and repairs can also drive up the price of insurance for trucks.

The Takeaway

The average annual rate for personal car insurance (as opposed to commercial) for a truck is $2,160 per year. The overall cost of the truck can impact the price of insurance. In general, the more expensive a truck is, the more it costs to insure it. For this reason, special features may also increase your cost. Perhaps surprisingly, truck insurance is not more expensive than car insurance. In fact, pickups are relatively less expensive to insure than other types of vehicles.

When you’re ready to shop for auto insurance, SoFi can help. Our online auto insurance comparison tool lets you see quotes from a network of top insurance providers within minutes, saving you time and hassle.

SoFi brings you real rates, with no bait and switch.

FAQ

Do trucks cost more to insure than cars?

Generally, trucks don’t cost more to insure than other types of cars. They’re actually relatively cheaper to insure than some types of vehicles. How much it costs to insure a car is usually based more on the overall cost of the car than the type of car someone chooses to drive. So an inexpensive truck may cost much less to insure than a luxury SUV or sedan.

Is insurance high on a pickup truck?

Insurance isn’t necessarily high on a pickup truck. Trucks usually cost less to insure than other types of cars. That said, high-value pickups can cost a lot to insure. The higher a truck’s (or any car’s) price, the higher the insurance premiums tend to be.

---

About the author

---

Photo credit: iStock/JMichl

Auto Insurance: Must have a valid driver’s license. Not available in all states.
Home and Renters Insurance: Insurance not available in all states.
Experian is a registered trademark of Experian.
SoFi Insurance Agency, LLC. (“”SoFi””) is compensated by Experian for each customer who purchases a policy through the SoFi-Experian partnership.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.


Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOPRO-Q424-001

Read more

To some, it may sound like as much fun as the dentist, but switching car insurance companies can make a great deal of sense. Besides, getting new car insurance really doesn’t have to be an ordeal.

That being said, to make sure you’re getting the best policy for your situation — and potentially snagging a price cut when you make a successful switch — it’s important to follow a step-by-step plan. Read on to learn what to do if you’re wondering how to switch car insurance.

When Do You Need to Switch Car Insurance?

Wondering whether switching car insurance companies makes sense? Here are some common reasons to make the change:

•   Your life circumstances have changed: Many people seek a new policy when their life has changed. Clearly if you have bought a new car, you need to look into options. If you’re planning to move to another state (or even to a different zip code), if you want to add a spouse or a child to the plan, or even if you have a new job, your existing insurance might no longer be the best fit.

•   You want to lower costs: Getting the least expensive premium is often the goal of getting new car insurance. If you noticed a sharp increase in your premium and didn’t have an accident or any other triggering incident, then switching may be a good way to lower your car insurance premiums.

•   You’re dissatisfied or looking to get certain perks: There are other reasons to change insurers aside from cost. Maybe you had a poor customer service experience with your current provider. Or perhaps you want a service that another insurer offers, like free roadside assistance.

•   Your credit score changed drastically: Another reason you might want to consider getting new car insurance is a drastic decrease or increase in your credit score. That shift could have a good (or bad) effect on your present policy, but a different insurer could look at it differently, so it’s worth your time to investigate. (Note: California, Hawaii, Massachusetts, and Michigan don’t let insurers set policy rates based on credit scores. And Maryland, Oregon, and Utah have strict limitations in place.)

On the other hand, there are some times when changing up your insurance might not be the best idea, including when:

•   You’ve just had an accident or gotten a ticket.: If you’ve had a recent accident or received a ticket, it might not be a good time for a change. Your insurer will likely raise your rate, but the recalculation won’t take effect until your annual renewal time. You may as well take advantage of the months you have left before the policy renews.

•   You’ll lose certain benefits if you switch.: Some companies offer loyalty discounts or accident forgiveness clauses for customers who stick with them. Make sure the loss of those benefits is worth it to you.

How to Switch Car Insurance in 5 Steps

If you’re ready to change car insurance, here’s what to do.

1. Research and Evaluate Your Coverage Needs

Do you have too much insurance or too little? The former could strain your budget, but the latter could leave you exposed to financial disaster.

Nearly every state makes it a law that you pay for some liability coverage or you can’t drive the car. After figuring out that base, it’s time to determine your collision and comprehensive car insurance needs.

Taking into account your type of car, your driver’s record, and your assets, you can determine how much auto insurance coverage you really need. You need to know that before you approach insurers eager for your business.

2. Shop Around

There are many more car insurance companies out there than you may realize, making it a highly competitive business. Experts recommend that you get quotes from at least three insurers.

You’ll need to have facts ready to feed into the evaluation to get a quote, including:

•   The address where the car will be stored

•   The car’s make, model, and year

•   The Vehicle Identification Number (VIN)

•   Your driver’s license or Social Security number

Be prepared to give the same facts to each insurer so you can make an accurate comparison.

Also, check out the companies’ customer service records and review each company’s payment options. Don’t forget to find out what discounts that you could qualify for, too.

3. Contact Your Current Insurer

Once you’ve picked your new plan and have proof of insurance, contact your previous insurance company to cancel. Keep in mind that some insurance companies may penalize you if you cancel before the policy expires.

To be on the safe side, log onto your account and cancel the automatic payments after you’ve ended the old policy. Some experts recommend that you put this all in writing and send a letter to your insurer, specifying to cancel the coverage by the agreed-upon date.

4. Avoid a Coverage Gap

It’s extremely important to make sure there are no gaps in your auto insurance, even a single day. You’ll bring a firestorm of legal and financial problems on yourself if you have an accident while uninsured, and you may even lose your driver’s license.

Also, should you seek out a new insurer in the future, if you have a record of lapsed insurance, you could be stuck with an expensive policy. So before canceling your old insurance, make sure to triple-check the effective date of your new policy.

Recommended: Auto Insurance Terms, Explained

5. Print Out Your ID Cards and Switch

After you’ve signed up with your new insurer and canceled your old plan, take the former ID card out of your car or your wallet and replace it with your new one. If you haven’t received the card in the mail yet, you can always print it out.

If your state allows digital proof of ID, you can access your digital ID card through the insurer’s app.

How Often Can You Switch Car Insurance Providers?

You can switch companies as often as you like, and there is generally no penalty for doing so (though some insurers do charge a fee if you switch before the end of your coverage period). The Insurance Information Institute recommends reviewing your coverage once a year.

Aside from switching carriers entirely, you can also speak to your current insurer about updating your plan if your life circumstances have changed since you got your existing plan.

Recommended: Car Insurance Guide for New Drivers

The Takeaway

A better auto insurance plan might exist for you — but how to switch car insurance, you wonder? It’s not that hard. Making the change requires research into how much coverage you really need, obtaining quotes, and then, once you’ve decided to switch, canceling properly and making absolutely sure there are no coverage gaps.

When you’re ready to shop for auto insurance, SoFi can help. Our online auto insurance comparison tool lets you see quotes from a network of top insurance providers within minutes, saving you time and hassle.

SoFi brings you real rates, with no bait and switch.

---

Photo credit: iStock/Edwin Tan

Auto Insurance: Must have a valid driver’s license. Not available in all states.
Home and Renters Insurance: Insurance not available in all states.
Experian is a registered trademark of Experian.
SoFi Insurance Agency, LLC. (“”SoFi””) is compensated by Experian for each customer who purchases a policy through the SoFi-Experian partnership.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SOPRO-Q225-019

Read more