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Why Is My Insurance So High in 2024?

Have you looked at your car or home insurance bill recently? I assume that may be why you’re here. As you pick your jaw up off the floor and think of all the other things you would rather spend that money on, a few questions might run through your head.

Like, Why is my insurance so high? or Why have my insurance premiums gone up again?

Let’s look at why your home and auto insurance prices are so high and what you can do to stop rising premiums from cramping your budget.


Key Takeaways

  • Auto and home insurance rates are rising in reaction to tough market changes.
  • The increased number of natural disasters and accidents over the last several years resulted in more claims.
  • The property and casualty insurance industry has been running at a loss for years.
  • Rising premiums are an attempt to balance out losses and keep the insurance industry alive.
  • You have several options for lowering your premiums, including raising your deductible, checking for discounts, and bundling coverage.

Market Factors Impacting the Rising Cost of Insurance

If it’s any consoloation, you’re not the only one feeling the pain of insurance premiums going up. Home insurance rates are up about 23% just in the last year, according to data from Quadrant Information Services. In the U.S., car insurance rates are up 39% compared to December 2019, and they’re up 64% in the U.K.!1 Yes, it’s not just us Americans—the entire world is dealing with this! Increasing insurance rates are one the thing that unify us all. The great equalizer.

So, you get that insurance rates are going up—but why? Did Flo put her headband on backward and just decide to jack up rates? Did Mayhem decide to go into overdrive? (Actually, that sounds like something he would do.)

The fact is, the property and casualty insurance industry (aka home and auto insurance providers) has been struggling for a while.2 Home insurers have lost money in five of the last six years.3 And lately things have just gotten worse. Skyrocketing used car prices (remember the handwritten “I want to buy your car!” windshield notes from 2021?), more severe weather events and natural disasters, and more accidents, along with inflation (think car parts, building supplies and labor) and supply-chain bottlenecks (think car parts again) mean more claims and higher payouts. Add it all up and it’s not hard to see why the industry isn’t profitable anymore.4,5

Let’s think of it in terms of another kind of business. If your local wild yeast sourdough bread baker usually sells a loaf for $8 but the price of wheat skyrockets and their kitchen rent increases, you’d expect them to raise the price of a loaf, right?

The same applies to the insurance industry unfortunately. The cost to insure people has risen—maybe not you specifically, but insurance isn’t about the individual. It’s about spreading the cost (and risk) across the group, and the cost for a bunch of people rose dramatically.

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Why Is My Car Insurance So High?

Why is my car insurance so high? is becoming an all-too-common refrain, right there among “slay” and “rizz.” The truth is there could be a bunch of reasons why you’re paying so much for car insurance. Some of the most common factors that influence how much you’re paying for insurance are your deductible, the kind of car you drive, driving record, claim history, commute, credit score, history of paying for insurance, your location, age, gender, and add-ons to your policy. And then there’s the market factors I touched on above.

Why is car insurance going up? Let’s break it down.

Personal Factors

It’s not personal! Well actually, it kind of is.

Your Age and Gender

Believe it or not, insurance companies look at age and gender to determine insurance rates. Drivers under 25 and over 75 tend to have higher rates, since insurers see their policies as high-risk insurance. Depending on your age, men and women often end up paying different rates too.

Your Location

If you live in a big city or an area with lots of traffic accidents, then your premiums will be higher compared to suburban or rural parts of the country. Insurance companies look at the number of claims made in the area, the crime rate and the population density. If any of these are high, your insurance rate will be too.

Your Credit Score

If you’ve got a credit score under 600, you’ll pay more for car insurance. Of course, you can wind up with a cheaper rate by improving your credit score over time, but I don’t love that idea. There’s a better way to go about fixing this problem: getting rid of your credit score completely.

I know, I know, that sounds totally weird. But you’ll be better off in the long run if you stop messing around with debt altogether. Yep—this means paying off your debt and never using credit cards, payment plans, or any kind of financing again. Eventually, your credit score will disappear (or become indeterminable in credit score speak), and you’ll have more cash in your pocket because you won’t have any debt payments. And by the way, you won’t miss those payments, credit cards or your credit score.

Here’s the truth: A credit score is nothing more than a number that says how much you love debt. And debt isn’t your friend—it keeps you from having any money margin in your life.

So instead of pulling out your credit card and swiping your way to a more affordable car insurance premium, pull out a pair of scissors and cut that credit card up. You’ll thank me later when you’re no longer playing rigged reward games or drowning in the high-interest payments those predatory companies lock you into.

How You Drive

Calling all speed demons, Sunday drivers, joy riders, text-and-drivers, and accidents waiting to happen—this section’s for you.

Your Driving Record

Speeding tickets, DUIs and other violations will push your rates up faster than the officer can say, “License and registration, please.” If this is how you drive, asking Why is my car insurance so high? is a rhetorical question. But a safe driving record can actually lower your rate! Some insurance companies even offer good-driver and safe-driver discounts. See if you qualify for one of these to lower your existing rate.

Your Commute

Long commutes or traveling on especially dangerous highways will increase your rates. That’s why insurance companies ask where you work on your application. While you’re probably saving big on your housing expenses by commuting, it’s hiking up your car insurance.

Now, you don’t need to pack up your stuff and move—it’s not worth it just to save a little on your insurance. But if you’re already looking to move, a smaller insurance premium may come as a bonus.

Choice of Vehicle and Safety

Are you the newest member of the #MazdaMommy gang? Is your car known for the size of its engine or its safety features? Do you upgrade your model every five years for the latest release, just like Leo DiCaprio and his girlfriends? Take a look at how your choices here impact your rate.

Your Car’s Value

In case you haven’t noticed, everything is more expensive these days, and cars are near the top of the list. The average cost of a new car hovers close to $45,000.6 (And here I was thinking $6 for a Starbucks drink was out of control.)

Even though used car prices have settled a little since their meteoric rise a couple years ago, they’re still up there. And basic economics tells us that higher car values equal higher insurance costs. So, even if you don’t have a super expensive luxury car, your car’s value could be affecting your insurance rate.

Your Car’s Safety Features

Vehicle safety can also affect your insurance prices. Cars that do well on safety tests, like the Insurance Institute for Highway Safety test, have lower insurance premiums.

Look up the safety ratings the next time you’re shopping for a car—or ask your insurance agent how your car’s rating might affect your premium.

Car Insurance Choices and History

How you’ve handled insurance in the past will also affect your car insurance future. To throw some Lion King wisdom at it: Yes, the past is in the past—but the past still hurts.

And it’s not just the past. The choices you make right now push your rates up or down too.

Your Claim History

Even though it’s their job to deal with, insurance companies don’t like it when you file a lot of claims. And they definitely don’t like big claims. Anything from a couple fender benders to wrecking one too many cars will increase your premiums. Consider skipping a claim and paying for smaller repairs out of pocket to avoid raising your rates.

Your History of Paying for Insurance

Lapses in coverage can also cause your premiums to spike. It’s the law to have car insurance if you own a car, and you’ll pay the price if you haven’t had a policy for a period of time. So, to avoid higher premiums, make sure you’ve always got car insurance if you own a car. In some situations, it’s even a good idea to have insurance when you don’t own a car—that’s called non-owner car insurance. (Clever name, huh?)

Your Deductible

Your deductible is how much money you’re on the hook for when something happens to your car and you file a claim to get it fixed. It’s what you pay to fix your car before your insurance company covers the rest. If your policy has a lower deductible, that means the insurance company takes on more risk. You’ll pay less for the repairs in the moment, but you’ll have higher premiums as a result.

Market Factors

Like your age and gender, market factors are also not something you can really do anything about. But they’re pushing your rates up faster than a Zoomer runs to a sale on mom jeans.

More Accidents

In the U.S., accidents are getting more severe. After everyone took a break from driving during 2020’s shutdowns, insurers say drivers came back more reckless.7 Deadly accidents have been on the rise the last several years.8 All of this means more claims and more payouts by your insurance company. And they have to make it up somewhere (hint: your premium).

Supply Chain Snafus

If you’re seeing a trend here, you’re not wrong. The pandemic really threw a wrench in things. The supply chain woes of the last several years (thanks, global chip shortage!) caused fewer cars to be produced.

Like I said above, the value of your car affects your rate. Well, as the supply chain ground to a halt and new cars stopped being made, car prices everywhere shot to the moon. This means without you doing a thing, your vehicle got more valuable. Really cool if you were thinking about selling it. Not cool when it comes to insuring it.


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A RamseyTrusted pro can hunt down the best car and home insurance deals to get you quality coverage without breaking the bank.

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Why Is My Homeowners Insurance So High?

It’s not just car insurance that’s giving the world’s tallest skyscraper a run for its money. Home insurance rates are making homeowners everywhere wail, Why is my insurance so high?

Like I mentioned earlier, there is quite a handful of different factors playing into the rise, including more natural disasters and supply chain problems. But there’s also factors that you have control over like where you live and your deductible.

Your Deductible

Just like with car insurance, the size of your home insurance deductible impacts your rate. It might sound nice not to have to pay a lot out of pocket if your house gets damaged, but you’ll pay every month with higher premiums.

Your Location

If you live in a disaster-prone area, your premiums are going to reflect that. Coastal areas, Tornado Alley and flood plains—just to name a few—are all bad places to live if you’re looking for cheap home insurance.

Market Factors

No one can really predict future weather, but looking back over the last several years, we’ve certainly had a lot of natural disasters. It’s kind of a matter of luck whether a storm will hit and where, but big hurricanes like Ian and Irma have pummeled the East Coast. Out west, wildfires and storms have been hitting hard.

It might sound crazy, but an uptick in severe thunderstorm impacts (think tornadoes) is one of the biggest reasons your home insurance is rising. Just last year, these weather events led to a record $55.6 billion in insured damage and accounted for roughly two-thirds of all natural disaster damage.9

How is there more storm damage? Are there more storms? Maybe . . . but there are definitely more houses and buildings in the way of storms. The U.S. economy is still growing, and as urban areas continue to sprawl out further and further, there are more built-up areas that can be knocked flat by storms.10

Supply chain and labor issues aren’t helping. As soon as a storm kicks in a house, it has to be rebuilt. But there’s a labor shortage in construction workers and supply issues thanks to COVID-19.11,12 It’s more simple economics: Fewer workers mean higher wages, and shortages in materials mean higher prices. So not only are more houses getting beat up, but they’re more expensive to rebuild. Now that’s what I call the perfect storm.


What is RamseyTrusted

When good, hardworking people (that’s you) need expert help with life’s big decisions, like shopping for insurance or buying a house, you should be able to get it—and feel confident about it. That’s why we’ve made it our mission to find pros who value people over profits. Before a pro gets to wield our shield, we put them through the wringer. Our vetting process involves layers of safety nets, including a scoring system, fan feedback and an ongoing relationship. We weed through the duds so you only have to work with top-notch, principled service providers—and can feel confident in those big decisions.

  • 20 years of service
  • 5,000 pros nationwide
  • 5M fans served

Read our full history

How to Save on Insurance

Sure, insurance rates may be in the stratosphere. But are you really destined to pay sky-high rates forever? No way. The truth is that most people are overpaying for coverage by hundreds of dollars! If that’s you, here are some ways you can lower your premiums fast:

1. Raise Your Deductible

If you have at least $1,000 saved for emergencies, raise your deductible! Having a higher deductible means lower premiums, since you’re taking on a little more risk. But you’ll have more money in the bank to cover that higher deductible if you get in an accident or your home gets damaged and, almost always, you’ll wind up saving money in the long run.

2. Get Rid of Coverage You Don’t Need

Let me be very clear: If you own a home, you need home insurance—enough to replace your house if it gets destroyed. And there are certain types of car insurance you should almost always have in place. Those include liability, comprehensive and collision coverage. Together, these three kinds of insurance give you full coverage—from injuries and damage done to others to theft and damage done to your own car.

But there are also plenty of types of coverage you can probably drop from your policy to shave some of the cost off your premiums. Look at your policy and decide if you really need everything you’re paying for. If you only buy the coverage you need, you can ditch the extras and lower your premium.

Here are some auto coverages you might consider cutting if they’re not required in your state:


Here's A Tip

While everyone wants to save money, there are some coverages you need to have.

For home insurance, you need to have enough to replace your home if it get’s destroyed.

For car insurance, you should get enough collision and comprehensive to replace your car if it’s totaled, and at least $500,000 in liability. 

3. Take Advantage of Discounts

Don’t forget about any discounts you or other drivers on your insurance may qualify for.

If you’ve got a teen on your policy, that’ll jack up your rates. The same goes for elderly family members. Luckily, some insurance providers offer discounts on policies with teenagers if they have good grades or a safe driving record. Take advantage of these perks to lower your existing rate.

And discounts aren’t just for auto insurance. Homeowners can sometimes qualify for discounts by installing certain safety features like burglar alarms.

4. Bundle Your Policies

Let’s say you’ve got homeowners insurance and auto insurance through two different insurance providers. Well, if you were to bundle those policies by getting rid of one (or both) of them and buying your insurance through one provider, you’d be able to conveniently manage your policies and save money on premiums.

Some companies say they can save you up to 25% when you bundle your insurance, and it might not be a bad idea to investigate whether that’s a promise they’ll keep.

But there is a chance that bundling insurance won’t be cheaper for you. Depending on what you need, buying policies from separate companies could be the cheaper option.

For example, let’s say you’ve got a modest car and an expensive home. If the provider offers a bundle with expensive car insurance but cheap homeowners insurance, you may find better coverage at a better deal by breaking up the bundle. Review your policy and compare rates to see what might work best for you.

5. Compare Quotes From Different Providers

Why is car insurance so expensive? Maybe it’s because you haven’t shopped around!

Think about it: When was the last time you actually shopped for car or home insurance and compared quotes? Was it when you bought your car? A year or two ago? During the Cold War? Yeah. It’s high time to check on those policies. (And probably replace your air filters too. Yes, your home and car have air filters.)

Lots of folks just stay with the same insurance because it’s easy and they don’t think to check around. Don’t do that! Be like Jamie B., who finally reached out to a RamseyTrusted pro who could shop quotes for him.

“We were people who just stayed with what we have always known,” Jamie said on the Ramsey Baby Steps Facebook Community group. “When we reached out to the RamseyTrusted pro, we found the exact same policies for homeowners and our cars a lot cheaper. I was not disappointed!”

For home insurance, you need to have enough to replace your home if it get’s destroyed.

For car insurance, you should get enough collision and comprehensive to replace your car if it’s totaled, and at least $500,000 in liability.


How to Navigate Rising Insurance Rates

Besides doubling down on all the savings tips we’ve mentioned, calling in an expert to help you navigate your insurance is one of the surest ways to know you’ve got the best rate you can get.

A lot of people make the mistake of working with an insurance agent who can’t (or won’t) compare quotes from different insurance companies (those are called captive agents). Bad idea, people!

You want to work with an independent insurance agent, like a RamseyTrusted insurance pro. They’re not tied to any one carrier, so they’re working for you. They can do all the heavy lifting—like pulling quotes from all the companies so you can pick the best deal.


Next Steps

  • Learn more about car insurance and home insurance.
  • Read up on how much car insurance and homeowners insurance you need.
  • Get in touch with a RamseyTrusted insurance pro who can do the heavy lifting for you—like gathering quotes—and help figure out the right coverage for you.
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Frequently Asked Questions

The main factors that affect your car insurance rate include your age, gender, location, driving record, choice of car, deductible and claim history.

The quickest and easiest way to lower your car insurance premiums is to raise your deductible. Almost always, higher deductibles = lower premiums.

Yes. If you have a credit score under 600, you’ll pay more for car insurance. Having no credit score is a whole lot better than having a low score. Luckily, there’s a tried-and-true solution to getting rid of it: cutting up your credit cards and ditching debt forever.

Since new cars tend to be more valuable than old cars, car insurance rates are usually higher for new cars. However, it’s possible that an insurance policy for an old car that’s worth more will cost more than a policy for a new car that’s worth less. It all comes down to the value of the car being insured.

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George Kamel

About the author

George Kamel

George Kamel is the #1 national bestselling author of Breaking Free From Broke, a personal finance expert, a certified financial coach through Ramsey Financial Coach Master Training, and a nationally syndicated columnist. He’s the host of the George Kamel YouTube channel and co-host of Smart Money Happy Hour and The Ramsey Show, the second-largest talk radio show in America. George has served at Ramsey Solutions since 2013, where he speaks, writes and teaches on personal finance, investing, budgeting, insurance and how to avoid consumer traps. He’s been featured on Fox News, Fox Business and The Iced Coffee Hour, among others. Learn More.

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