Car Insurance Up 30% Since 2022, Drivers Feel the Squeeze

Auto insurance costs have soared 30 percent over three years. With no relief in sight, millions of Americans are cutting coverage, switching insurers, or dropping policies altogether.

Why does this matter right now?

Car insurance has gone from a routine expense to a financial gut punch. According to new data from CarInsurance.com and the U.S. Bureau of Labor Statistics, auto insurance rates have jumped roughly 30 percent since 2022. That’s not a bump. That’s a blowout.

Premiums climbed at double-digit rates in both 2023 and 2024. The Insurance Information Institute says 2025 will pile on another 7 percent increase. Drivers are already feeling cornered. Nearly 78 percent of respondents in a national survey said their rates jumped at least 5 percent over the past year. Some saw hikes of 30 percent or more.

It’s not just inflation. The price of repairing modern cars, the spike in post-pandemic accidents, and tariffs have made replacement parts more expensive. Insurance companies aren’t eating those costs. They’re passing them directly to you.

How are drivers reacting?

They’re making hard choices. CarInsurance.com commissioned a March 2025 survey of 1,460 drivers, and the takeaway was clear: people are fed up.

• 75 percent said they’ve already tried to lower their premiums
• 34 percent are actively shopping for cheaper policies
• 19 percent admitted they’ve canceled or reduced their coverage to save money

That’s not about preferences. That’s about survival.

Even long-time policyholders with clean driving records are being penalized. The number one reason people switch providers? A rate hike. More than 67 percent of those surveyed said they left their insurer after a price increase.

Where are rates rising the fastest?

It depends on your ZIP code. CarInsurance.com analyzed 53 million insurance quotes across 170 providers in 29,152 cities and 34,588 ZIP codes.

There’s no single pattern, but some states stand out. In Florida, regulators have approved rate decreases of up to 10 percent for specific carriers. But in California, it’s the opposite. Insurers there are locking in increases of up to 7 percent.

Unfortunately, most states are following California’s lead. And things are only expected to get worse.

Why is insurance so expensive now?

Let’s start with the cars themselves. Modern vehicles are loaded with sensors, cameras, and software. Today, a minor fender-bender might require thousands of dollars in electronic calibration.

Add more cars, distracted drivers, and expensive claims in a post-pandemic crash spike.

Now pile on the tariffs. New import duties on vehicles and parts are raising replacement costs. According to the American Property Casualty Insurance Association, insurers will pass those costs to consumers through higher premiums.

In some states, regulators have also raised minimum coverage requirements, meaning you’re legally required to buy more insurance than before.

Put it all together, and you get a 40 percent jump in less than three years.

What does this mean for the future?

It’s not just a budget issue; it’s a public safety concern. Underinsurance is on the rise, and coverage gaps are growing. Some people are skipping insurance altogether and hoping they don’t get caught.

That’s dangerous for everyone on the road.

Still, there are ways to fight back. Comparison shopping works, policy customization works, and switching carriers, even if only to send a message, works.

But if you’re not paying attention, you’re probably overpaying.

This isn’t just a warning. It’s a wake-up call. The era of set-it-and-forget-it auto insurance is over.

Like what you’ve read? Stay in the driver’s seat with more insider automotive insights. Follow @NikJMiles and @TestMiles for stories that go beyond the press release.

car insurance, auto insurance premiums, 2025 insurance rates, 40 percent rate hike, insurance inflation, tariff impact, best car insurance, save on auto insurance, driver survey 2025, car insurance news