An Overview of Car Insurance Cost in Texas


Do you live in Texas? If yes, then you must be aware of the monthly car insurance rates of the state. If not, then you must read this. Drivers in Texas pay an average of $595 per year for a minimum insurance coverage, that makes $49 monthly premium payment. If you require full coverage, the total yearly payable is almost $1948, that makes a $162 monthly pay-out.

Though, the premiums of every individual vary depending on several factors that influence the car insurance. Your premiums majorly depend on your age, sex, driving experience, driving record, area of residence, car type, credit rating and the coverage you opt for.

It is a fact that car insurance is costly in Texas. Living in a state where auto insurance is mandatory, everyone would want to get the best rates for the coverage they require. So, why do Texans pay 26% higher than the average countrywide? If you want an answer to this, then read this.

Auto insurance in Texas

An average Texan is required to pay more than $1900 for auto insurance coverage annually while the yearly auto insurance pay-out across the nation is $1449. When shopping around for the car insurance, it is helpful to have an idea about the average price of auto insurance of your region. However, while there are many factors that influence your final insurance rate, these are mainly dependent on the driver and insurance company you choose to purchase from.

Why is car insurance costly in Texas?

If you observe that your auto insurance rates are progressively rising, you are not the only one. Generally, car insurance rates have amplified for everyone in the past few years. An analysis reveals the following things might be contributing towards it:

  • Population density: After California, Texas is the second most populated state in the United States. So, majority of the people are residing in metropolitan areas that are fairly close to each other. The urban public in the United States accounts to be 80% of the population, while in Texas it is 84%. In general, metropolitan regions tend to pay more than rural areas for the car insurance. The reason is that there is greater driving risk in larger cities due to congested traffic, high risk of robbery and vandalism.
  • More accidents: As metropolitans have a higher population, it implies more road traffic. In 2017, Texas recorded the greatest number of fatal accidents compared to other states. More accidents result in more claims, so insurance companies must account for these risks.
  • High speed limits: Texas is known to have the fastest highway in the nation with an 85 MPH speed limit. Besides, it also has the hastiest average allowable speed of 75 MPH. Hence, it helped relieve traffic congestion between Austin and San Antonio. As the speed limits are high, the probability of accidents is also greater, that leads to greater liability payments from insurance companies.
  • Uninsured drivers: The number of uninsured motorists in Texas is somewhat higher than the nationwide average. Almost 15% of the drivers drive without insurance even though it is obligatory in Texas, this impacts insured motorists and their rates as insurance companies face a greater risk of people filing uninsured drivers’ claims.
  • Long travel time: A substantial percentage of Texans drive long distances to their workplaces and spend a lot of time in traffic. In Houston, more than 72% of the people drive to work with an average travel time of 26 minutes.
  • Driving trends: Matched to other states, Texan residents are required to drive more. The drivers in metropolitan and rural regions opt for more car trips and have to drive more miles per capita. The more you drive, the greater insurance premium you have to pay. Greater time spent on roads mean that there is higher opportunity for a car accident.
  • Higher minimum requirements: In Texas, the liability coverage is needed. If you are responsible for an accident, the liability coverage pays for the repairs for your car and other person’s car. Moreover, the medical expenditures are also covered. You must have at least $30,000 coverage for injuries per individual, $60,000 for injuries per accident, and $25,000 of coverage for property damage.
  • Natural disaster: Texas is listed among top states of the US that are susceptible to natural disasters like storms, tornadoes, hurricanes, floods, and wildfires. After the Hurricane Harvey in 2017, auto insurance rates spiked by 8%. While it was also due to the factors mentioned above, the likelihood of natural disaster was also a major contributor.

How can you save on auto insurance premiums?

Hunt discount options: You should be aware that insurance companies are generous at offering discounts. Whenever you shop for an auto insurance policy, you should discuss discount options. Chances are that you might be entitled to any discount. If you have a flawless driving record, you can be entitled to a good driver discount. Insurers generally incentivize motorists for being accident and violation free among three to five years. You can enjoy a lower rate if you are eligible.

If you are a student, depending on your insurance company, your good grades can save you some money on auto insurance. For that, you will have to submit your result or transcript to the insurance company as they will require a proof before granting discount.

Moreover, if you are insuring more than one car or seeking for a homeowners or renters’ insurance on top of the car insurance, you might be eligible for a mark-down on your premium. There are a huge range of discounts that insurance companies offer, so always make sure to inquire about it because you never know what you are eligible for.

  • Upturn your deductibles: One of the convenient ways to reduce your premium is to increase your deductibles. You need to be careful of how much you raise your deductibles by and make sure that you can pay your deductible when you file a claim.
  • Revaluate your coverage: If you have an older car, it is a sensible decision to opt for liability coverage instead of full coverage. To know which option is best for you, you must identify how much you would get from your insurance company if your car was majorly damaged. For instance, if the yearly cost of full coverage insurance is greater than 10% of what you would receive in pay-out then it might be sensible for you to forgo full coverage.
  • Focus on your credit score: Improving your credit score cannot happen overnight. You need to consider your credit score and try to improve it. This will certainly help reduce your car insurance premium in the long run. So, if you have a low credit score, you might have to pay double the premium amount compared to a person with good credit score.
  • Less driving: If possible, try to carpool with your workmates or classmates. Another option is to take a public transport. The insurance companies will see you as a less risky client if you spend less time driving as it reduces the chance of accidents. This will lower down your premiums. However, if there is a major difference, you might be eligible for a low mileage rebate.
  • Always shop around: It is a prevailing misconception that automatically staying with the same insurance corporate for many years will get you more affordable rates. Though insurers reward loyalty, you should never avoid shopping around and contrasting rates.

Though shopping around is a challenging task, you can review the services of an insurance broker who will do the work for you. On average, you may review 30 carriers to obtain the best possible insurance rate in the market for the coverage you are looking for.

Contact Us

Freedom Insurance Group
3861 Long Prairie Rd Ste 110
Flower Mound, TX 75028
Phone: (972) 798-3769


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