What Is the Average Cost of Full Coverage Insurance on a New Car?

Buying a new car is a major investment, and it's important to make sure you have the right coverage for it. When you're shopping for auto insurance, you'll often be asked if you want full coverage. But what does that mean, and what is the average cost of full coverage insurance on a new car?

What Is Full Coverage Auto Insurance?

Full coverage auto insurance includes both liability insurance and comprehensive coverage. Liability insurance covers costs related to an at-fault accident that you cause, such as medical bills and car repairs. Comprehensive coverage covers damage to your vehicle from theft, vandalism, fire, and other non-accident related events. It also covers damage caused by animals, weather, and other natural disasters. Combined, comprehensive and liability coverage provide the most comprehensive protection for your vehicle.

Factors That Impact The Cost of Full Coverage Insurance

The cost of full coverage insurance on a new car can vary widely based on several factors. The make and model of the car, your driving history, and the amount of coverage you choose all have an impact on the cost of your insurance. Your credit score is also a factor, as many insurance companies use it to gauge your risk. Other factors, such as your age, gender, and location, can also have an effect on your insurance rates.

The Average Cost of Full Coverage Insurance on a New Car

According to the Insurance Information Institute, the average full coverage auto insurance policy costs around $1,500 per year. This is based on a policy that includes liability insurance, comprehensive coverage, and collision coverage with a $500 deductible. Of course, this is just an average and your individual cost can vary based on the factors mentioned above.

How to Save Money on Full Coverage Auto Insurance

If the average cost of full coverage insurance on a new car is too high for your budget, there are a few ways to save money. One way is to raise your deductible. A higher deductible will lower your premiums, but you'll need to pay more out-of-pocket if you have an accident. You can also consider dropping comprehensive and collision coverage if you have an older car that is not worth much. This will also lower your premiums, but you'll be responsible for any repairs or replacements if something happens to your vehicle. Finally, be sure to shop around and compare prices from multiple insurers before choosing a policy.

Conclusion

The average cost of full coverage auto insurance on a new car is around $1,500 per year. Of course, this is just an average and your individual cost can vary based on factors such as your driving history and the type of car you drive. To save money on your policy, consider raising your deductible, dropping comprehensive and collision coverage, or shopping around for better rates.