How many Americans are cutting spending to afford car insurance?

In Jerry's 2026 survey of 1,500 U.S. drivers, 52% said they had cut household spending in at least one category because of car insurance costs. The most common cuts were dining out at 36%, vacations at 26% and clothing at 25%. More concerning, 19% cut groceries, 14% cut retirement savings and 10% cut healthcare. The pressure reached high earners too, with 44% of those making $150,000 or more cutting back.

Is it a good idea to reduce my car insurance coverage to save money?

Reducing coverage lowers your monthly premium, but it can be risky. In the survey, 21% of drivers bought less coverage, and 66% of them felt they ended up with less protection than they needed. Dropping collision or comprehensive coverage saves money now, but you pay for your own repairs or a replacement vehicle after an accident. It is usually smarter to compare quotes or adjust your deductible than to strip protection.

What happens if I drive without car insurance?

Driving uninsured is illegal in every state except New Hampshire, and it can lead to fines, a suspended license and fees to get your coverage reinstated. About 7% of drivers in the survey went without insurance at some point in the past year because they could not afford it. If you cause an accident while uninsured, you can be responsible for the full cost of the damage and injuries. Keeping even basic coverage in place is almost always cheaper than the risk of going without.

How can I lower my car insurance bill safely?

Start by comparing quotes from several companies, since rates for the same driver can vary a lot. Ask about discounts for safe driving, low mileage, bundling or being a student. You can also raise your deductible if you have savings to cover it, or try a usage-based program that sets your rate based on how you actually drive. Jerry makes the first step easy by pulling real quotes from 100+ carriers based on your profile in minutes.

Americans Are Cutting Groceries — and Retirement Savings

More than half of American drivers (52%) have cut spending somewhere in their household budget to keep up with the cost of car insurance. Nearly one in five (19%) have trimmed their grocery budget, 14% have pulled back on retirement savings and 10% have cut healthcare spending. Those numbers come from Jerry’s 2026 State of American Drivers survey of 1,500 U.S. drivers, which looked at how people spend and how rising car insurance costs are changing those habits.

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Why car insurance costs keep climbing

Car insurance has been one of the fastest-rising household costs of the decade. The price of car insurance climbed 82.7% between 2016 and 2025, far outpacing overall inflation, according to the Insurance Information Institute. The steepest increases came recently: rates rose 20.3% in 2023 and 11.3% in 2024 before slowing to a 2.8% rise in 2025, according to the U.S. Bureau of Labor Statistics.

Why is this happening? Rising repair costs, pricier vehicles and more severe accidents have all pushed premiums higher. Many drivers have not seen their paychecks keep pace, so those increases land hard on household budgets.

Key TakeawayCar insurance prices rose more than 80% from 2016 to 2025, far faster than wages for most families. That gap is why so many drivers now cut back elsewhere to keep coverage.

Learn more: Why your car insurance is so high

What Americans are giving up to pay for car insurance

Many drivers treat car insurance as a fixed cost, trimming almost everything else before they touch it. In Jerry’s 2026 State of American Drivers survey, 52% of drivers said they had cut spending in at least one category to keep up with what they pay for coverage.

This is the first time the survey has seen drivers pulling back on essentials like food and healthcare, not just discretionary spending. Cutting a vacation or new clothes is expected when household costs climb. Cutting groceries, retirement savings and healthcare is a different story, because those trade-offs affect a family’s health today and its long-term security.

Jerry Insight: The 2026 survey marks the first time drivers report cutting essentials like groceries and healthcare to afford insurance, a sign the squeeze has moved from nice-to-haves to needs.

Even high earners feel the squeeze

This strain isn’t limited to lower-income households. Among drivers earning $150,000 or more a year, 44% still said they had cut spending somewhere because of car insurance costs.

The pressure holds even among drivers who say the bill is manageable, with 45% having trimmed spending elsewhere. Nearly half of all Americans (49%) said car insurance is not affordable for the average driver.

Key TakeawayThe strain runs up the income ladder. Even among six-figure earners, more than 4 in 10 are reshaping their budgets around the cost of car insurance.

The riskier trade-offs: skipped coverage and delayed repairs

Some drivers are cutting more than everyday spending – they are cutting their insurance coverage, too. About 21% said they bought less coverage in the past year, and among that group, 66% believe they now have less protection than they may need.

Driving without insurance is illegal in every state except New Hampshire, yet roughly 7% of drivers went without any car insurance at some point in the past year because they couldn’t afford their premium. That is a risky gamble. Beyond citations and a possible license suspension, an uninsured driver pays out of pocket after an at-fault crash or other loss.

Financial strain shows up at the repair shop, too. About 32% of drivers in our survey delayed or skipped a recommended repair because of cost, and 10% said they could not cover a $1,000 repair bill at all. That aligns with federal data: the Federal Reserve found that 37% of adults could not fully cover even a $400 emergency expense with cash, based on its 2025 survey of household finances.

Key TakeawayAbout one in five drivers cut their coverage last year, though most feared that it left them without enough protection. Dropping comprehensive or collision coverage trims your bill, but it leaves you paying for repairs or a replacement car yourself, so the savings can vanish after a single accident.

How to lower your car insurance without cutting groceries

There are safer ways to bring your car insurance bill down, and Jerry can do most of the work for you. In the State of American Drivers survey, 53% of drivers shopped around for a lower rate in the past year and 31% switched companies to get one, so plenty of people are already saving. Here is where to start:

If you are struggling to pay, look into assistance options and state programs before you drop your insurance entirely.
Compare quotes from several companies at least once a year. Jerry shows you real quotes from 50+ carriers based on your own profile in minutes, so you can see whether you are overpaying without the legwork.
Ask about car insurance discounts. Safe-driver, low-mileage, bundling and student discounts can add up quickly.
Consider a usage-based or telematics program. Six in 10 drivers said they would let an insurer track their driving in exchange for a lower rate.
Raise your deductible if you have savings to cover it. A higher deductible usually lowers your monthly premium.

Jerry makes it hassle-free to save on car insurance.

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Key TakeawayShopping around pays off for many drivers. More than half compared rates last year and about a third switched, proof there are safer ways to save than cutting coverage or skipping groceries.

The bottom line

Car insurance has become a bill families now build their budgets around, sometimes at the expense of groceries, retirement and healthcare. Before you cut something that matters, it’s worth seeing what you would actually pay elsewhere. Jerry can compare car insurance quotes from 100+ insurers based on your profile in minutes, to find the best match for your needs and budget.

FAQ

Why is car insurance so expensive right now?

Car insurance prices rose sharply in recent years, climbing 20.3% in 2023 and 11.3% in 2024 before slowing in 2025, according to the Bureau of Labor Statistics. Higher repair costs, more expensive vehicles and more severe accidents have all pushed premiums up. Many drivers have not seen their income rise as fast, which makes the bill feel heavier. Comparing quotes with Jerry is a quick way to check whether you are paying more than you need to.

How many Americans are cutting spending to afford car insurance?

In Jerry’s 2026 survey of 1,500 U.S. drivers, 52% said they had cut household spending in at least one category because of car insurance costs. The most common cuts were dining out at 36%, vacations at 26% and clothing at 25%. More concerning, 19% cut groceries, 14% cut retirement savings and 10% cut healthcare. The pressure reached high earners too, with 44% of those making $150,000 or more cutting back.

Is it a good idea to reduce my car insurance coverage to save money?

Reducing coverage lowers your monthly premium, but it can be risky. In the survey, 21% of drivers bought less coverage, and 66% of them felt they ended up with less protection than they needed. Dropping collision or comprehensive coverage saves money now, but you pay for your own repairs or a replacement vehicle after an accident. It is usually smarter to compare quotes or adjust your deductible than to strip protection.

What happens if I drive without car insurance?

Driving uninsured is illegal in every state except New Hampshire, and it can lead to fines, a suspended license and fees to get your coverage reinstated. About 7% of drivers in the survey went without insurance at some point in the past year because they could not afford it. If you cause an accident while uninsured, you can be responsible for the full cost of the damage and injuries. Keeping even basic coverage in place is almost always cheaper than the risk of going without.

How can I lower my car insurance bill safely?

Start by comparing quotes from several companies, since rates for the same driver can vary a lot. Ask about discounts for safe driving, low mileage, bundling or being a student. You can also raise your deductible if you have savings to cover it, or try a usage-based program that sets your rate based on how you actually drive. Jerry makes the first step easy by pulling real quotes from 100+ carriers based on your profile in minutes.
How much does the average American spend on car insurance?

Nationally, Jerry drivers pay an average of $1,802 per year for basic coverage and $1,802 per year for full coverage. Costs vary widely depending on your state, driving record, vehicle and coverage level. To see your own number instead of an average, you can compare quotes with Jerry based on your needs and unique driver profile.