The 10 Cheapest Cars to Insure in 2025 (Save Up to $4,426 Annually)

American drivers are facing a harsh reality: car insurance premiums have skyrocketed by 31% since 2023, with the average full coverage policy now costing $2,677 annually. But here’s what most people don’t know—choosing the right vehicle can slash your insurance costs by thousands of dollars each year.

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Why Car Insurance Costs Are Through the Roof in 2025

The surge in insurance premiums isn’t slowing down. According to Bankrate’s latest True Cost of Auto Insurance Report, Americans saw their premiums increase by 12% in just the past year alone. The culprits? Rising repair costs, increased accident rates, and severe weather events across the United States.

However, your vehicle choice remains one of the most controllable factors in determining your insurance costs. The difference between insuring the cheapest and most expensive vehicles can be as much as $4,426 per year—enough to cover a family vacation or boost your emergency fund.

The 10 Cheapest Cars to Insure in 2025

Based on a comprehensive analysis of over 70 vehicle makes and models, here are the vehicles offering the lowest insurance premiums:

Notice a pattern? Eight out of ten cheapest vehicles to insure are SUVs. This isn’t coincidental; SUVs typically offer better protection for occupants and cause less severe damage in accidents compared to sedans or sports cars.

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Cheapest Cars to Insure by Vehicle Category

Most Affordable Sedans to Insure

If you prefer the fuel efficiency and handling of a traditional car, these sedans offer the lowest insurance costs:

• Honda Civic: $2,662 annually
• Toyota Camry: $2,680 annually
• Mazda 3: $2,710 annually
• Toyota Prius: $2,765 annually
• Kia Forte: $2,846 annually
• Nissan Altima: $2,921 annually

Fun fact: The Chevrolet Bolt electric and Mini Cooper show 37% fewer bodily injury claims than average vehicles, making them excellent choices for eco-conscious and style-focused drivers, respectively.

Most Affordable SUVs to Insure

SUVs dominate the cheapest-to-insure category, with these models leading the pack:

• Subaru Outback: $2,229 annually (-57% bodily injury claims vs. average)
• Honda CR-V: $2,258 annually
• Subaru Forester: Excellent safety record (-54% bodily injury claims)
• Honda Pilot: $2,417 annually
• Ford Escape: $2,427 annually

Most Affordable Trucks to Insure

For those needing hauling capability, these trucks offer the best insurance value:

• Toyota Tacoma: $2,379 annually (-38% bodily injury claims for crew cab 4WD)
• Ford F-150: $2,608 annually
• Chevrolet Silverado 1500: $2,663 annually
• Toyota Tundra: $2,845 annually
• GMC Sierra: $2,919 annually

What Makes These Vehicles Cheap to Insure?

Insurance companies calculate premiums based on risk, specifically, how likely you are to file a claim and how expensive that claim might be. The cheapest cars to insure typically share these characteristics:

Superior Safety Features

Modern safety technologies significantly reduce accident risk and severity:

• Automatic Emergency Braking: Standard on most top-rated vehicles
• Blind Spot Monitoring: Reduces lane-change accidents by up to 23%
• Electronic Stability Control: Prevents rollovers and loss of control

Lower Repair and Replacement Costs

Vehicles with readily available, affordable parts cost less to repair:

• Common Models: Honda, Toyota, and Subaru parts are widely available
• Simpler Technology: Fewer complex systems mean lower repair bills
• Moderate Pricing: Vehicles under $40,000 MSRP typically cost less to replace

Excellent Safety Ratings

Insurance Institute for Highway Safety (IIHS) Top Safety Pick winners often enjoy lower premiums due to:

• Reduced injury severity in crashes
• Lower medical claim payouts
• Fewer total loss incidents

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The Most Expensive Cars to Insure (Avoid These)

To put savings in perspective, here are the costliest vehicles to insure:

These vehicles carry high premiums due to:

• Expensive Parts: Luxury and performance components cost significantly more
• Higher Theft Risk: Desirable vehicles are stolen more frequently
• Performance Capabilities: Sports cars are associated with riskier driving behavior
• Advanced Technology: Complex systems require specialized, costly repairs

7 Expert Strategies to Lower Your Car Insurance Costs

1. Choose Your Vehicle Strategically

Your car choice impacts premiums more than most realize. According to Shannon Martin, Bankrate insurance analyst: “Auto insurance costs can add thousands of dollars to your household budget, and getting locked into an unaffordable insurance payment for several years could put you in a difficult situation.”

2. Shop Around Religiously

Insurance rates vary dramatically between companies. The same driver might pay:

• State Farm: $1,800 annually
• Progressive: $2,400 annually
• Allstate: $2,100 annually

Always compare at least 5-6 insurers for the best rates.

3. Maximize Available Discounts

Common discounts that can save hundreds annually:

• Multi-policy discount: 5-25% off when bundling auto and home insurance
• Good student discount: Up to 25% off for students with B+ averages
• Defensive driving course: 5-15% discount in most states
• Low mileage discount: Up to 30% off for driving under 7,500 miles annually

4. Optimize Your Coverage Levels

• Raise deductibles: Increasing from $500 to $1,000 can save 10-20%
• Drop unnecessary coverage: Remove collision/comprehensive on vehicles worth under $3,000
• Adjust liability limits: Ensure adequate but not excessive coverage

5. Maintain Excellent Credit

In most states, credit score significantly impacts premiums:

• Excellent credit (750+): Baseline rates
• Good credit (700-749): 5-15% higher rates
• Fair credit (650-699): 15-30% higher rates
• Poor credit (below 650): 30-60% higher rates

6. Drive Defensively

Your driving record directly affects premiums for 3-5 years:

• Clean record: Qualify for good driver discounts
• One speeding ticket: 10-25% rate increase
• At-fault accident: 20-50% rate increase
• DUI conviction: 50-100% rate increase

7. Consider Usage-Based Insurance

Telematics programs can save safe drivers up to 30%:

• Progressive Snapshot: Monitors hard braking, rapid acceleration
• State Farm Drive Safe & Save: Tracks speed, phone usage, time of day
• Allstate Drivewise: Rewards safe driving with cashback

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How Much Should Insurance Costs Influence Your Car Purchase?

Insurance represents the largest ongoing ownership expense after loan payments. Consider these 2025 financial realities:

• Average monthly car payment: $742 (Experian Q4 2024)
• Average monthly insurance cost: $223
• Total monthly vehicle expense: $965+ (before fuel, maintenance, taxes)

Smart Shopping Strategy:

1. Narrow your vehicle choices to 3-5 models
2. Get insurance quotes for each specific make/model/year
3. Factor insurance costs into your total budget
4. Choose the vehicle with the best combination of features and insurance affordability

Regional Insurance Cost Variations Across America

Insurance costs vary significantly by state due to different regulations, weather patterns, and accident rates:

Most Expensive States for Car Insurance:

• Michigan: $3,643 annually
• Louisiana: $3,379 annually
• Florida: $3,244 annually
• New York: $3,139 annually
• Nevada: $2,999 annually

Most Affordable States for Car Insurance:

• Maine: $1,175 annually
• New Hampshire: $1,188 annually
• Vermont: $1,192 annually
• Wyoming: $1,251 annually
• Iowa: $1,398 annually

Even within expensive states, choosing the right vehicle can save thousands annually.

Common Insurance Shopping Mistakes to Avoid

Mistake #1: Only Comparing Price

The Fix: Evaluate coverage limits, deductibles, and customer service ratings alongside price.

Mistake #2: Sticking with the Same Insurer Too Long

The Fix: Shop rates annually, loyalty rarely pays in insurance.

Mistake #3: Choosing Minimum Coverage

The Fix: Adequate liability coverage protects your assets from lawsuits.

Mistake #4: Ignoring Discount Opportunities

The Fix: Ask about all available discounts; insurers don’t always volunteer them.

Mistake #5: Not Reading the Fine Print

The Fix: Understand what’s covered and excluded before signing.

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Technology’s Impact on Future Insurance Costs

The automotive landscape is rapidly evolving, affecting insurance costs:

Advanced Driver Assistance Systems (ADAS)

Modern safety features are reducing accident frequency and severity:

• Automatic Emergency Braking: Required on all new vehicles by 2029
• Lane Keeping Assist: Prevents 35% of lane departure crashes
• Adaptive Cruise Control: Reduces rear-end collisions by 40%

Electric Vehicle Considerations

EVs present unique insurance challenges:

• Higher Repair Costs: Specialized technicians and parts
• Battery Replacement Risk: Can total a vehicle
• Fire Risk: Rare but expensive when they occur
• Theft Target: High-tech components attract thieves

Autonomous Vehicle Future

Self-driving cars may revolutionize insurance:

• Reduced Human Error: 94% of crashes involve human error
• Manufacturer Liability: Shift from driver to automaker responsibility
• Lower Overall Costs: Fewer accidents mean lower premiums

Frequently Asked Questions

What car has the lowest insurance rates?

The Subaru Outback currently offers the lowest average insurance rates at $2,229 annually, followed closely by the Honda CR-V at $2,258.

Are SUVs really cheaper to insure than sedans?

Yes, on average. SUVs typically cost $237 less annually to insure than midsize sedans due to better occupant protection and lower injury claim rates.

How much can I save by choosing a cheaper-to-insure vehicle?

The difference between the cheapest (Subaru Outback at $2,229) and most expensive (Audi R8 at $6,655) vehicles is $4,426 annually, or $22,130 over five years.

Should I buy an older car to save on insurance?

Not necessarily. While older cars may have lower comprehensive/collision costs due to reduced value, they often lack modern safety features that qualify for premium discounts.

How accurate are these average insurance costs?

These are national averages. Your actual costs will vary based on age, location, driving record, credit score, and chosen coverage levels. Always get personalized quotes.

Take Action: Your Next Steps to Lower Insurance Costs

Insurance rates change frequently, and the best time to secure lower premiums is now. Here’s your action plan:

1. Identify your top 3 vehicle choices from our cheapest-to-insure lists
2. Get quotes from at least 5 insurers for each vehicle
3. Compare total costs including insurance, financing, and maintenance
4. Review and maximize all available discounts
5. Choose the combination offering the best value for your needs

Remember: The average American household spends $2,677 annually on car insurance, but with smart vehicle selection and comparison shopping, you could pay significantly less while getting better coverage.

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Rates change daily, and the sooner you compare options, the more you could save. Don’t let another month pass paying more than necessary for car insurance.

In another related article, How to Save on Car Insurance in 2025 (Even If You’re a New Driver)