Slower Rate Increases in 2025, But Auto Insurance Costs Still on the Rise

While auto insurance rates will continue to climb in 2025, the increases are expected to be smaller than the previous year’s 16.5%. The average cost of auto insurance will reach $2,101 annually, setting a new record. Despite a slight slowdown in rate hikes, drivers in states like New Jersey, Washington, and California will face the steepest rises—over 15%. Those with traffic violations could see their premiums jump as much as 146% in North Carolina. Electric vehicles (EVs) are seeing cheaper insurance rates, but new EVs are still 23% more expensive to insure than traditional cars.