Car insurance rates are climbing fast—where you live might be driving up the bill
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As retirement brings the promise of road trips, weekend getaways, and visits with family, the last thing anyone wants is a surprise detour in their finances.
But for many drivers across the US, the rising cost of car insurance is putting pressure on the very freedom the open road offers.
And yes—where you live may be making it worse.
The biggest driver? A 25% auto tariff on imported vehicles, first introduced during President Trump’s administration.
It’s part of a broader push to increase domestic manufacturing—but it’s also pushing up costs at the dealership and at the insurer’s desk.
"Looking ahead, the newly announced 25% tariffs on imported vehicles add another layer of difficulty for shoppers already facing high prices and interest rates,” said Ivan Drury, Director of Insights at Edmunds.
According to Insurify, full-coverage auto insurance could increase by at least 8% by the end of 2025.
Without tariffs, rates were already expected to rise by 5%—but with tariffs driving up car prices by an average of $3,000, insurers are recalibrating risk and passing costs along to consumers.
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"We’ll effectively be charging a 25% tariff, but if you build your car in the United States, there is no tariff," he said.
But with 45% of vehicles sold in the US still being imported, mostly from Mexico and Canada, the ripple effects on pricing—and insurance—are far from over.
Read next: Unbelievable price hike on this Costco product leaves shoppers stunned–is it worth the extra pay?
Have you noticed an increase in your car insurance rates recently? What strategies have you found effective in managing these costs? Share your experiences and tips with the GrayVine community in the comments below. Let's help each other stay on the road and in control of our finances, no matter what surprises come our way.
But for many drivers across the US, the rising cost of car insurance is putting pressure on the very freedom the open road offers.
And yes—where you live may be making it worse.
Why Insurance Rates Are Shifting into High Gear
While rising premiums aren’t new, recent policy decisions are sending them even higher.The biggest driver? A 25% auto tariff on imported vehicles, first introduced during President Trump’s administration.
It’s part of a broader push to increase domestic manufacturing—but it’s also pushing up costs at the dealership and at the insurer’s desk.
Motorists in the United States are facing increased car insurance costs. Image source: ABC 33/40 / YouTube
"Looking ahead, the newly announced 25% tariffs on imported vehicles add another layer of difficulty for shoppers already facing high prices and interest rates,” said Ivan Drury, Director of Insights at Edmunds.
According to Insurify, full-coverage auto insurance could increase by at least 8% by the end of 2025.
Without tariffs, rates were already expected to rise by 5%—but with tariffs driving up car prices by an average of $3,000, insurers are recalibrating risk and passing costs along to consumers.
Also read: Shoppers brace for impact: New law forces millions to pay extra on groceries starting April 1—find out why
The Zip Code Effect: Where You Live Matters
Unfortunately, not all states will feel the pinch equally. Insurify's analysis suggests that drivers in every state will be paying more than previously forecasted. Some of the sharpest increases include:- Maryland: Now projected to be the most expensive state for car insurance, with full-coverage policies averaging $4,824 per year—an increase of $746 from 2024.
- New York: Residents can expect the largest year-over-year hike, with premiums increasing by 24%, or $911 on average.
- Even states like Hawaii, Vermont, and New Jersey—once expected to see rate decreases—are now looking at 12%–13% jumps.
How to Steer Around Soaring Costs
The good news? You’re not powerless. Whether you’re buying a new vehicle or looking to reduce your monthly bill, here are six ways to save on car insurance in 2025:- Reshop Every Few Years
Don’t assume loyalty pays. Experts recommend comparing quotes every 2–3 years—you might be surprised by the savings.
- Get a Quote Before You Buy
Planning to purchase a vehicle? Check insurance rates before you commit. Some models are far pricier to insure than others.
- Compare Before You Renew
Policy renewals are the perfect time to shop around. Use that window to explore better offers from competing providers.
- Choose a Budget-Friendly Car
Vehicles with strong safety ratings, low repair costs, and fewer claims history often lead to lower premiums.
- Ask About Discounts
Don’t leave money on the table. Ask about safe driver, low mileage, senior, or bundling discounts with home or life insurance.
- Raise Your Deductible (If You Can Afford It)
A higher deductible means more out-of-pocket if you file a claim—but can significantly lower your monthly premium.
Also read: Fast food chain shocks with price hike—here’s why customers are fuming!
Looking Ahead: Will These Tariffs Stick?
President Trump has stated that the tariffs will remain permanent, encouraging automakers to shift production to the US"We’ll effectively be charging a 25% tariff, but if you build your car in the United States, there is no tariff," he said.
But with 45% of vehicles sold in the US still being imported, mostly from Mexico and Canada, the ripple effects on pricing—and insurance—are far from over.
Read next: Unbelievable price hike on this Costco product leaves shoppers stunned–is it worth the extra pay?
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