Your car insurance costs could increase in the next few months based on these projections.
California car insurance rates soar by more than 50%
Car insurance rates are projected to soar by 54% in California in 2024.
Fox – LA
- An insurance comparison company used data to project premiums for the rest of the year.
- Some states could pay annual car insurance premiums over $3,400.
Car insurance premiums are projected to increase in the state of Tennessee, disrupting a trend of national auto insurance cost stability.
Tennessee isn’t the only state that may have to cough up more cash for car insurance. The cost of auto insurance in America could increase by as much as 7% nationally, according to Insurify, an American insurance comparison shopping site.
Insurify’s data scientists examined “over 97 million rates” to project how much the average American driver could pay for full-coverage insurance by the end of 2025. Here’s how much insurance premiums could increase in the Volunteer State before 2026.
What’s the average cost of car insurance in Tennessee?
Auto insurance is a necessary expense meant to protect drivers and their vehicles from disastrous financial woes in the event of accidents. Full coverage insurance can cover your vehicle, injuries, and property damage. It can also cover non-collision damages from theft, natural disasters, and more. The catch is, auto insurance can cost a pretty penny in some states.
The average annual cost of auto insurance in Tennessee, as of June, was $1,635. Costs can increase by as much as 5% with tariffs by the end of 2025 to $1,746, says Insurify. That’s an increase of $111 annually or $9.25 a month. This may not be a huge increase or expense, but it’s troubling considering car insurance rates declined in most states in the first half of 2025.
Tennessee annual auto insurance costs had decreased by 2% year-over-year in the first half of 2025. Now, they’re projected to steadily rise before the end of the year, costing Tennesseans more money due to factors such as inflation and tariffs.
Why car insurance premiums could increase in second half of 2025
Tariffs are having a huge impact on the auto industry because many automotive parts come from foreign countries. Additionally, the final assembly of several popular automotive nameplates takes place outside of the United States. Some automakers like Tesla are less exposed to the tariffs thanks to American manufacturing, but some of the largest American automotive brands have been feeling the sting of increased import costs.
Part of the reason why car insurance premiums could increase by the end of 2025 is the cost to insure parts manufactured in foreign countries. Insurance providers have to raise costs to cover their own repair expenses when it comes to foreign parts.
Insurify also cites inflation and the amount of money insurers are paying out in claims as reasons why insurance premiums are projected to increase. Which states will see the highest increases and where does Tennessee stand in terms of its insurance premium increase compared to the rest of the country?
These states are projected to have the most expensive auto insurance premiums
Based on Insurify’s projections, at least 10 states have projected annual auto insurance premiums over $3,000. Four states have projected annual premiums over $3,400.
Five states/regions with the highest projected annual auto insurance premiums
- Maryland ($4,235)
- New York ($3,935)
- Washington, D.C. ($3,848)
- Delaware ($3,465)
- South Carolina ($3,362)
Tennessee doesn’t have the least expensive car insurance premiums, and even the highest rate increases won’t bring the Volunteer State into the top 10 states with the most expensive auto insurance.
