Tariffs on imported auto parts may soon affect more than just consumer goods—they could also drive up the cost of car insurance across the U.S.
Gabby Olivas recently experienced the rising costs firsthand.
“I thought that it was really high, so I went window shopping for others and then I realized that was just the norm right now,” Olivas said. “So yeah, that’s a little scary, but it’s also like, you know, gonna have to make it work.”
According to the latest federal inflation data, car insurance rates have increased 5.3% year-on-year, averaging $213 per month for full coverage. Experts warn that tariffs could accelerate these increases. The national average for full-coverage insurance is projected to rise 7% by the end of the year if tariffs remain in place, compared with a forecasted 4% increase without them, according to Insurify.
“Car insurance essentially covers the cost of your car, repairs, and replacement in the event of an accident,” said Chase Gardner, data insights manager at Insurify. “If the cost of repairing your car rises due to more expensive parts affected by foreign tariffs, insurance rates have to rise to keep up with these costs.”
Despite these pressures, there are strategies to manage insurance expenses. Melissa Lambarena, a personal finance expert, recommends:
Shopping around annually to compare rates and secure the best deal.
Asking your insurer about available discounts.
Bundling auto insurance with home or renters coverage to potentially lower premiums.
As tariffs continue to impact the auto industry, drivers should review their policies carefully and explore cost-saving measures to offset potential increases.
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