If you buy a second (or third, or fourth) car, you’ll need to add it to your car insurance policy. This is true whether it’s a daily commuter vehicle or if you only drive it a few times a year.
We found that adding a second car to a full-coverage policy raises rates by an average of $1,185 per year (or $99 per month) for the additional coverage. But while insuring two cars is more expensive than insuring a single vehicle, there are still ways to save money on a multi-car policy and find affordable rates for more than one car.
How much does adding a second car affect insurance?
Rates vary significantly from one company to the next. While we found that adding a second car to a full-coverage car insurance policy raised rates by an average of $1,185 a year (about $99 a month) for a 72% increase, some companies saw an increase as low as $862 per year while others saw as much as a $1,804 annual increase. At State Farm, for example, we found the average rate increase after adding a second car was $854, a difference of 68%, while at Nationwide, rates increased by an average of $1,185, an 80% increase.
The table below shows how much rates change when drivers add a second car to their insurance policy at these top car insurance companies:
Company | Rates for one vehicle | Rates for two vehicles | Total rate increase | Percent increase |
|---|---|---|---|---|
USAA | $1,126 | $1,988 | $862 | 77% |
State Farm | $1,252 | $2,106 | $854 | 68% |
GEICO | $1,240 | $2,182 | $942 | 76% |
Nationwide | $1,486 | $2,671 | $1,185 | 80% |
Travelers | $1,647 | $2,696 | $1,049 | 64% |
Progressive | $1,713 | $2,775 | $1,062 | 62% |
Allstate | $1,953 | $3,356 | $1,403 | 72% |
Farmers | $1,957 | $3,461 | $1,504 | 77% |
MetLife | $2,452 | $4,256 | $1,804 | 74% |
Adding a second car to your auto insurance will change your rates, but how much of an increase you get will be based on a number of factors.
You’ll pay just a little more if your second car is a used vehicle that you only want to cover with liability insurance, but a new car that needs full coverage (including gap insurance) could significantly raise your rates.
Does adding a car increase car insurance rates?
Yes, adding a second car to your insurance policy will raise your rates, but the increase might be much lower than you expect. Insurance companies usually offer a variety of ways to save money on insurance multiple cars, including:
Multi-car discount: Insurance companies often offer a multi-car discount for drivers with two or more vehicles, sometimes saving drivers as much as 25% on the cost of insurance for their second car.
Low mileage discount: If your second car doesn’t get much use, you may be able to get a discount or reduced rate based on your low annual mileage.
Driver rate changes: If you purchase a second car for a teen driver or someone with infractions on their driving record, purchasing a vehicle that is much cheaper to insure than your primary car for them could potentially save you money on your insurance.
Is it expensive to add a second car to insurance?
It can be, depending on the situation. Insurance companies set rates based on a number of factors, including the make and model of the car you drive.
For example, adding a 2022 Ford Mustang to your insurance is going to be much more expensive than adding a 2011 Honda Accord, because newer, pricier cars cost more to repair or replace after an accident.
If you can afford to replace an older car out-of-pocket, having an inexpensive used vehicle as a second car also means you can choose liability-only coverage and drop comprehensive and collision coverage on your second car, which can save you hundreds of dollars each year on your car insurance.
Remember, you don’t need to have identical coverage on both cars, even on the same policy, so one car can have full-coverage even if the other doesn’t.
Can I be the primary driver on two different cars?
No, you can only be the primary driver on one car. When adding cars or drivers to your policy, your insurance company will want to know who is regularly driving each car.
For example, if you have three cars on your policy for yourself, your spouse, and your 17-year-old child, each driver will be listed as the primary driver of the car they use most often.
If you have more cars than drivers, each driver in the household will be listed as a primary driver on one vehicle and additional vehicles will be listed as an extra car.
How many cars can you have on one insurance policy?
Most insurance companies have a limit of four or five cars per insurance policy. This is more than enough for most people, but some drivers have big families or lots of cars and need additional coverage.
What is the best way to insure multiple cars?
If you have more cars than are typically allowed on a standard auto insurance policy, you can often take out a second car insurance policy to cover any additional vehicles and drivers.
Each insurance company is different, so check with your insurance agent to find out how your insurance company covers five or more vehicles on the same policy.
Drivers with a large number of vehicles (typically 25 or more) may also want to consider self-insurance to help keep their insurance costs low.
How long do you have to add a new car to your insurance policy?
In some cases, you can’t drive a new car off the lot without having insurance in place, so you need to go online or call your insurance company and add your new car to your policy before you buy it.
However most car insurance companies offer a grace period for adding new cars to your policy, usually up to 30 days, during which the new car will automatically be covered. The details of any grace period will depend on your insurance company’s rules and the laws in your state, so check with your car insurance company to make sure a new car would be covered.
Frequently asked questions
What is the cheapest way to insure two cars?
Adding a car to your existing insurance policy is almost always cheaper than purchasing a second policy, but the best way to make sure you are paying the lowest possible rate is to compare quotes from multiple companies.
Do you need insurance to drive someone else's car?
No, you don’t need your own car insurance policy to drive a car that belongs to someone else. But if you drive someone else’s car regularly, you may feel more secure if you buy a non-owner car insurance policy to supplement the other driver’s insurance.
Can you insure a second car for occasional use?
Yes, even a car that is only used occasionally can (and should) be added to your policy. You may be able to get a lower rate for having a low mileage vehicle, or even get a lower rate by categorizing your spare car as an extra vehicle rather than a primary use vehicle.
Can you have two cars on one insurance policy?
Yes, you can have more than one car on an individual insurance policy. In fact, most insurance companies offer a multi-car discount for drivers who insure more than one car on the same policy.
Methodology
policycentral has analyzed car insurance rates provided by Quadrant Information Services for every ZIP code in all 50 states, plus Washington, D.C.
For full coverage policies, the following coverage limits were used:
Bodily injury liability: 50/100
Property damage liability: $50,000
Uninsured/underinsured motorist: 50/100
Comprehensive: $500 deductible
Collision: $500 deductible
In some cases, additional coverages were added where required by the state or insurer.
Rates for overall average rate, rates by ZIP code, and cheapest companies determined using averages for single drivers age 30, 35, and 45. Our sample vehicle was a 2017 Toyota Camry LE driven 10,000 miles per year.
Rates for driving violations and “poor” credit were determined using average rates for a single male 30-year-old driver with a credit score under 578.
Some carriers may be represented by affiliates or subsidiaries. Rates provided are a sample of insurance costs. Your actual quotes may differ.
