Car insurance is like a bit like fire extinguishers. You keep the updated extinguishers in your home just in case you need them, although you hope you never do. The same goes for your car insurance policy. You pay your insurance rates in the hopes that you’ll never need your policy to bail you out of a bad situation. Despite the necessity, millions of Americans are looking at pricier coverage in 2025 due to rising rates and increasing minimum coverage standards.

Higher minimum coverage standards and rising premiums could make car insurance rates pricier than ever for millions

2025 could be a spendy year for Americans seeking to save on their car insurance rates. Historically, state governments mandated some kind of liability coverage. In the case of state-required liability coverage, your provider may cover some or all of the damage or injuries you cause during a crash. However, several states are changing the minimum coverage requirements for motorists in the new year.  

According to Newsweek, California, Utah, North Carolina, and Virginia raised their standards for minimum insurance coverage. As a result, many motorists in these four states may have to pay extra to contend with the “rising costs of car repairs and medical bills” related to motor vehicle accidents (MVAs).

Unfortunately, the rising requirements aren’t the only thing; insurance rates in general rose last year. Troublingly, rates in California rose around 46% throughout 2024, per Insurify. That increase puts The Golden State ahead of the US average, while Utah, Virginia, and North Carolina remain below the national average. 

So how do you know if you’re going to see pricier car insurance rates? Well, if you live in North Carolina, Utah, California, or Virginia, you can expect your rates to rise. However, drivers who already carry higher levels of car insurance coverage aren’t as likely to feel the squeeze of rising coverage requirements. 

Fortunately, there are a few things you can do to lessen the financial burden of your car insurance policy. For starters, not filing a claim can keep your policy rates from rising. I know, duh, right? However, your age can also play a part in your rates decreasing over time. For instance, you could pay around 72% less for full coverage as a 25-year-old than you did at 16. Of course, your rates depend on factors like location, vehicle type, and gender, not just driving history and age.