What is a car insurance premium and how does it work?
Your car insurance premium is the amount you pay your insurance company on a regular basis, often every month or every six months, in exchange for insurance coverage. Once you've paid your premium, your insurer will pay for coverages detailed in the insurance policy, like liability and collision coverage.
What are auto insurance premiums and deductibles?
Also important to note, auto insurance premiums are separate from your deductible, which is the dollar amount you must pay before your insurance will kick in. All types of insurance require you to pay a premium, not just auto: homeowners, life and renters insurance also require premium payments.
What is the average annual car insurance premium?
According to the most recent data from the National Association of Insurance Commissioners (NAIC), the average annual car insurance premium is $889. For people who purchase all three of the major types of car insurance – liability insurance and collision and comprehensive insurance – the average annual premium is $1,009.