California car insurance rates dropped in 2025
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California car insurance prices dipped 8% last year after a post-pandemic stretch of skyrocketing costs, a new Insurify report finds.
By the numbers: The average annual full-coverage premium was $2,309 in 2025 — about $208 cheaper than in 2024.
- That's the 16th-highest average cost among states.
The big picture: Prices also fell nationally (about 6%), and some states saw much larger drops including Wyoming (-30%), Iowa (-25%) and Arkansas (-23%).
- Average rates are up big time in some places, including New Jersey (+20%) and Washington, D.C. (+18%).
Reality check: The relief comes after California car insurance costs spiked nearly 40% in 2024 as some insurers requested double-digit rate hikes after the state froze rates during the pandemic.
Between the lines: Last summer, projections warned that prolonged tariffs could cause prices to jump, but "insurers' margins are now high enough to absorb tariff-driven costs without raising prices," Insurify said.
- "Now, many insurers are cutting rates to attract and retain new customers."
What's next: Average full-coverage premiums in California and nationally will rise 1% this year, the report predicted — though U.S. tariff policy poses a "potential wrinkle" in such forecasting.