Car insurance rates in California have traditionally gone up over time, with steady rate increases every year since 2011. As the state population grows and the insurance companies pay out more in claims, California drivers see an increase in their car insurance rates (even among the safest drivers).
In 2020, state insurance Commissioner Ricardo Lara instituted a temporary freeze on price increases for auto insurance in 2020, but drivers should expect rates to start increasing again sooner rather than later. [1] Once car insurance rates begin to climb, drivers in California should shop around and compare quotes from multiple companies to make sure they’re getting the most affordable auto insurance available.
Did car insurance rates go up in California?
California drivers haven’t seen an official increase in their rates since 2020, but rates are going up across the country, and drivers should expect to see an increase in the average cost of car insurance in California at some point in the future.
California has strong regulatory agencies and in the beginning of 2022, the California Department of Insurance continued to deny requests from insurance companies to increase their rates. [2] But costs are going up for those auto insurers, which means those costs will eventually be passed on to their customers.
Why are auto insurance rates going up in California?
Your insurance rate is the amount you pay for car insurance each month or year. Insurance companies raise rates based on a number of factors, including things you can control, like your driving history, and things you can’t control, like natural disasters that mean they have to pay out a bunch of claims at once.
There are several factors that could cause auto insurance premiums to rise in California.
Wildfires
There has been a significant increase in the number (and severity) of wildfires in California over the last several years, which means insurance companies have seen an increase in the number of wildfire-related claims. Just one incident in 2020, the Western Wildfires, burned more than 10.2 million acres and caused $16.5 billion in damage across the Northern California and Oregon area. [3]
More damage means more insurance claims, which means the car insurance companies see losses they may need to recoup by raising rates for drivers.
Inflation
According to the New York Times, the U.S. government reported that average prices have risen 8.3% since April of 2021. [4] This is the highest inflation rate America has seen in 40 years and it impacts everything from the cost of groceries and gasoline to your car insurance premium.
As inflation increases operating costs for the insurance company, including the costs of car parts and repairs, you can expect those costs to be passed on to you at your next policy renewal.
Supply chain disruptions
The number of new cars being built has gone down thanks to disruptions in the industry, driving up the value of your average used car. Someone who owned a 2010 Toyota Corolla in 2019 might have expected to sell it for $1,000 or less, but that same car may have been worth about $4,000 in 2022. [5]
The increase in value means insurance companies are now expected to pay out higher amounts if your car is stolen or totaled, which may contribute to upcoming rate increases in California.
Your profile
Some California drivers may already be seeing an increase in their insurance rates, but this is likely due to changes that are specific to them. If you move to a new house, buy a new car, get in an accident, or file a claim, you may see an increase in your insurance rates.
How much is the average car insurance rate in California?
Drivers in California pay an average of $1,857 per year for full coverage car insurance, but the amount you’ll actually pay can vary based on a number of factors.
Your ZIP code, your driving history, and the type of car you drive are just a few of the details insurance companies use to set your rates. Location matters because insurance companies use statistical information in your city or ZIP code, like the number of accidents reported annually in a specific area, to help set rates for drivers who live there.
For example, drivers in Alameda pay an average of $1,807 per year, while drivers in Beverly Hills pay an average of $3,065 per year.
Drivers in Southern California will likely pay a different rate than drivers in Northern California, while drivers in big cities should expect to pay more than drivers in rural areas. Here’s how much California drivers pay for car insurance in the state’s ten biggest cities:
Los Angeles: $2,642
San Diego: $1,775
San Jose: $1,829
San Francisco: $2,194
Fresno: $1,799
Sacramento: $2,017
Long Beach: $2,068
Oakland: $2,156
Bakersfield: $1,833
How much is car insurance per month in California?
California drivers pay an average of about $154 per month for full-coverage car insurance.
However, drivers who carry only the minimum coverage required by the state pay an average of $601 per year, which breaks down to around $50 per month. The state minimum insurance requirements only include liability coverage, so drivers who need comprehensive and collision coverage should purchase full coverage insurance.
→ Learn more about how much car insurance you need
Will my car insurance increase after an accident in California?
Maybe. If you are in an accident that isn’t your fault, like if hail damages your car or if you’re hit by a reckless driver, the odds are good it won’t impact your insurance rates. However, an at-fault accident could raise your rates.
And if the car accident involves another violation, like driving with a suspended license or driving with an open container, you can expect your rates to increase significantly.
Violation | Average annual rate | Percent increase |
|---|---|---|
Hit and Run | $4,843 | 160% |
DUI | $5,267 | 183% |
Driving with a suspended license | $4,684 | 152% |
Racing | $5,029 | 170% |
Reckless Driving | $5,058 | 172% |
At-fault Accident | $3,306 | 78% |
Driving with an open container | $3,309 | 78% |
Speeding Ticket | $2,772 | 49% |
Passing a school bus | $2,848 | 53% |
Improper passing | $2,810 | 51% |
Following too closely | $2,810 | 51% |
Illegal turn | $2,810 | 51% |
Failure to stop at a red light | $2,810 | 51% |
Failure to yield | $2,810 | 51% |
Failure to show documents | $2,735 | 47% |
Driving without Lights | $2,652 | 42% |
Driving with expired registration | $2,735 | 47% |
Not at-fault Accident | $1,857 | 0% |
Frequently asked questions
How can I lower my car insurance rates in California?
The easiest way to lower your car insurance rates is to compare quotes between multiple companies and choose the cheapest option, but there are other ways to help bring down the cost of your insurance. Keeping your driving record clean, taking advantage of any available discounts, and bundling insurance policies with the same provider can also help you keep your insurance rates low.
Does my credit score affect my car insurance rate?
Some states allow insurance companies to consider your credit score when setting your rates, but California isn’t one of them. Drivers in California don’t have to worry about their credit affecting their car insurance rates.
Is car insurance in California expensive?
It can be, depending on where you live in the state and your personal driving history. California car insurance rates are higher than the national average, but some other states (Florida, Louisiana, Michigan, etc.) have significantly higher average insurance rates than California.
Methodology
Policygenius has analyzed car insurance rates provided by Quadrant Information Services for every ZIP code in all 50 states, plus Washington, D.C.
For full coverage policies, the following coverage limits were used:
Bodily injury liability: 50/100
Property damage liability: $50,000
Uninsured/underinsured motorist: 50/100
Comprehensive: $500 deductible
Collision: $500 deductible
In some cases, additional coverages were added where required by the state or insurer.
Rates for overall average rate, rates by ZIP code, and cheapest companies determined using averages for single drivers age 30, 35, and 45. Our sample vehicle was a 2017 Toyota Camry LE driven 10,000 miles per year.
Some carriers may be represented by affiliates or subsidiaries. Rates provided are a sample of insurance costs. Your actual quotes may differ.
