Full-coverage car insurance now costs American drivers an average of $208 a month, or close to $2,500 a year, and for the first time since 2022 that national figure is barely moving. After three straight years of double-digit increases, insurers are projecting a rise of well under 1 percent in 2026. The calm is uneven, though: drivers in five states still pay more than $300 a month for the same coverage, and for someone stretching a fixed retirement income, the gap between a policy in the cheapest state and one in the most expensive can decide whether a car stays insured at all.
Why the national average finally stopped climbing
Full-coverage premiums rose 11.57 percent in 2023, 17.13 percent in 2024 and 7.56 percent in 2025, a run of increases insurers tied to costlier repairs, pricier replacement parts and a wave of weather-related claims. The 2026 State of Auto Insurance report from ValuePenguin projects national rates will rise just 0.67 percent this year as those pressures ease, the smallest annual change since before that stretch began. The average masks a wide split underneath it: some states will see bills climb more than 10 percent at renewal, while others will see rates fall by roughly 6 percent.
The company-level picture explains part of the calm. Five of the 10 largest car insurers in the country are expected to lower rates in 2026, led by State Farm, projected to cut prices by about 4 percent. Allstate has the largest increase among major insurers at just 1.98 percent, while Geico, Nationwide, Progressive and Travelers are all holding close to flat. Midsize insurers are moving faster in both directions: NJM policyholders could see bills rise by more than 21 percent at renewal, while Erie and Plymouth Rock customers face increases near 7 percent and 6 percent.
New Jersey carries the steepest projected increase in the country, an estimated 10.46 percent at renewal. Nevada, California, New York and Washington, D.C. are also expected to see bills rise more than 5 percent in 2026. Iowa sits at the other extreme, projected to post the largest decrease at 6.19 percent, with Minnesota, Arkansas, Missouri and Illinois also seeing meaningful drops in the same analysis.
Free download: Property-tax freezes, exemptions and circuit-breaker credits, plus LIHEAP and shutoff protections, and what to gather before applying. Get the free property tax and utility relief finder.
Free download from RetireShield. Getting it also signs you up for the free Retirement Money Brief, a weekday email. Unsubscribe anytime.
The five states where full coverage still tops $300 a month
Nevada, Louisiana and Florida remain the three most expensive states for full coverage, each running at least 50 percent above the national average. ValuePenguin’s state-by-state breakdown puts Nevada drivers at the top at $335 a month, followed by Louisiana at $327 and Florida at $311. Connecticut and Delaware complete the list of states averaging more than $300, at $305 and $302. Together those five states sit at least 45 percent above the $208 national figure, a gap of more than $100 a month for coverage most drivers are required to carry.
Vermont, Maine and Wyoming sit at the opposite end, each at least 37 percent below the national average; Vermont’s $128-a-month rate is less than two-fifths of what a Nevada driver pays for comparable coverage. The five-year trend shows how fast a state’s ranking can shift: Texas premiums climbed 60.97 percent between 2020 and 2025, the largest five-year increase of any state, while Hawaii’s rates rose just 4.17 percent over the same period, the most stable in the country.
What comparing quotes is worth on a fixed income
The spread between insurers within a single state is often larger than the spread between states. Shopping for the cheapest quote could save a driver more than $500 a month, or 406 percent, in Connecticut, where Travelers’ average full-coverage rate of $127 a month runs about one-fifth the cost of the state’s most expensive carrier, according to the ValuePenguin data. Even in states with a narrower gap, the dollar difference is real: New Hampshire has the smallest average price spread in the country, yet switching from the priciest company there to the cheapest can still save more than $1,000 a year.
For a retiree on a fixed monthly check, that spread matters more than the headline national number. A driving record also carries a real price tag at renewal: a ticket or accident raises average premiums by 54 percent nationally, and the increase varies sharply by state. North Carolina drivers see the steepest jump after an incident, an average of 137 percent, while a first DUI there pushes full coverage to roughly $592 a month, about four times what a clean-record driver pays. Pennsylvania sits at the other end, with a typical post-incident increase of about 35 percent, a reminder that the cost of a single ticket or fender-bender depends heavily on where the policy is written.
Comparing quotes at renewal, rather than letting a policy roll over automatically, is one of the few insurance costs a household can still control directly even as repair and claims costs keep pushing the underlying market higher. Because full coverage is required in nearly every state to legally keep a car on the road, the choice usually is not whether to carry it, but which company to carry it with, and the ValuePenguin data suggests that choice alone accounts for much of the difference between a $170 bill and a $335 one.
The insurance bill isn’t the only one a fixed income has to absorb
A car insurance renewal notice rarely arrives alone; property tax bills, heating costs and home-repair estimates tend to land in the same stretch of the year, and relief for those costs usually isn’t automatic. Most of it has to be requested, and the request has its own paperwork and its own deadline.
The Senior Property Tax & Home-Cost Relief Kit lays out the 5 kinds of property-tax relief and the circuit-breaker credit that includes renters, alongside heating, cooling and home-repair help.
Look through what applies before the next bill arrives: The Senior Property Tax & Home-Cost Relief Kit.
This article was produced with the assistance of AI and reviewed by The Money Overview editorial team before publication.
