In 2026, Ms. Zhang from Beijing found that when renewing her car's insurance, she had saved 2500 yuan in premiums compared to the first year. Changing companies actually adds a few hundred yuan to the quote, so it's more cost-effective to renew the insurance directly. She thought that new energy vehicle insurance would always be expensive, but didn't expect the price reduction to come so quickly.

However, in Chongqing, Mr. Li, the owner of a gasoline car, complained on social media that he had not been involved in any accidents for many years, but this year his insurance premiums have increased by more than 1000 yuan.

When it comes to car insurance premiums, there are always people who are happy and some who are worried. The calculation of car insurance costs is not simple, as it is influenced by multiple factors such as natural disaster payout ratio, driving habits, mileage, maintenance costs, changes in pricing coefficients, and dynamic adjustments in compulsory traffic insurance prices. Therefore, it is difficult for car insurance premiums to experience a uniform increase or decrease.

What is the average insurance premium per car

Ms. Zhang's domestically produced new energy vehicle has a landed price of about 250000 yuan. Last year's first-year premium was about 7800 yuan, but this year's renewal has dropped to around 5300 yuan. Despite a significant decrease, this premium remains at a relatively high level in the industry.

In the view of Dai Haiyan, Managing Director of Risk Information China at Law&Business Alliance, this does not mean that the auto insurance industry has entered a general decline channel. Currently, the overall auto insurance market is showing a trend of "stability with decline and structural differentiation".

According to a reporter from the Economic Observer, among the 58 property insurance companies that disclosed their average car premiums for 2024 and 2025, 31 of them had a decrease in average car premiums in 2025 compared to 2024, accounting for 53.44%. This means that more than half of the insurance companies have experienced a decline in the average car premium.

The average premium per vehicle refers to the average value obtained by dividing the total premium income of all insured vehicles by the total number of vehicles within a certain statistical period. Due to the different types and risk conditions of vehicles underwritten by various property insurance companies, there is also a significant difference in the average premium level per vehicle.

The data shows that the lowest average premium per car is only 841.99 yuan, while the highest reaches 5900 yuan. Among them, over 70% of insurance companies' average car premiums are concentrated in the range of 1000 yuan to 3000 yuan. Insurance companies with higher average premiums for cars mainly focus on new energy vehicle insurance. For example, BYD Property&Casualty Insurance, JD Allianz Insurance, and Hyundai Property&Casualty Insurance mainly offer new energy, new energy commercial vehicle, and new energy ride hailing insurance, respectively.

According to data from the Ministry of Public Security, by the end of 2025, the total number of new energy vehicles in China will reach 43.97 million, accounting for 12.01% of the total number of vehicles; Throughout the year, 12.93 million new cars were registered, accounting for 49.38% of the total new car registrations.

Compared with fuel vehicles, new energy vehicles exhibit new characteristics in terms of risk structure, responsible parties, and protection boundaries, which have a profound impact on the pricing logic and compensation costs of insurance products. With the increase in the number of new energy vehicles, the proportion of new energy vehicle insurance premiums has also increased, which has to some extent raised the average premium level of vehicles.

As the competition in the auto insurance market gradually becomes more rational and pricing power becomes increasingly refined, there are signs of improvement in the long-term high premiums of new energy auto insurance.

Taking Hyundai Property&Casualty Insurance, which currently mainly operates new energy ride hailing services, as an example, its average premium per vehicle will be 6100 yuan in 2024 and 5700 yuan in 2025. BYD Property and Casualty Insurance, which also operates a large number of new energy vehicle insurance businesses, has an average premium of 4500 yuan and 4054.53 yuan per vehicle in 2024 and 2025, respectively.

The person in charge of Modern Property and Casualty Insurance stated that for new energy vehicle insurance, in the past, due to limited data accumulation, insurance companies did not accurately identify the risks of new energy vehicles, and pricing was relatively conservative. Nowadays, with the development of technology and the continuous accumulation of data, the precise pricing model of "thousands of people, thousands of faces" for car insurance has been realized. Insurance companies can more accurately assess risks, making premium pricing more reasonable, and the premiums of customers with lower risks have also decreased accordingly.

Why did the price increase even though there was no accident

On social media platforms, there are many gasoline car owners like Mr. Li who complain about the increase in car insurance prices. Some car owners have stated that their car insurance premiums have increased by 30%. The salesperson explained that this is due to losses in the electric vehicle business, and the company has raised the discount coefficient for the fuel vehicle business. Some car owners also claimed that the salesperson explained that the price increase is related to the increase in extreme weather and related compensation amounts in recent years.

Dai Haiyan said that currently, the pricing logic of car insurance is undergoing profound changes, shifting from the past "look at the car" pricing system to a comprehensive pricing system that "looks at people, uses, and cars". Insurance companies are no longer solely based on vehicle prices for pricing, but rather refer more to factors such as the historical accident rate of the vehicle model, the zero to whole ratio (the ratio of the total price of all vehicle accessories to the overall sales guidance price), maintenance costs, and owner driving behavior. This is also the root cause of the phenomenon of "continuous years of no insurance claims but rising premiums": when the overall payout ratio of a certain car model is too high, the insurance company may raise the pricing coefficient of that car model. Even if individual car owners have a good record, they may still face premium increases.

Behind this change is the deepening of the comprehensive reform of car insurance in 2020. The reform has expanded the range of autonomous pricing coefficients for insurance companies, giving them greater pricing flexibility. A property and casualty insurance practitioner pointed out that by 2025, due to multiple factors such as frequent natural disasters, an increase in the upper limit of death and disability compensation to 200000 yuan, and rising prices of automotive parts, the compensation costs of car insurance business in many regions will rise, thereby raising the lower limit of the self pricing coefficient. At the same time, the reduction of implicit discounts that existed in the past has also made consumers more directly feel the upward pressure of insurance premiums.

How should consumers understand the price of car insurance?

Dai Haiyan stated that the price of car insurance is not simply a commodity price, but is determined by the risk cost. The risk cost can be considered at three levels: on-board factors, namely vehicle type risk, whose historical compensation, zero to zero ratio, and maintenance costs will all affect the premium price; Individual factors, namely driving behavior risk, can enjoy discounts if there are no consecutive accidents. High risk driving or violation will lead to an increase in insurance premiums, and the risk coefficient of car models with a concentration of young car owners is relatively high; The on-demand factor, that is, the risk of vehicle usage nature, when household cars are used for ride hailing operations, risks and rates are prone to mismatches.

Dai Haiyan said that for consumers, before purchasing a car, they can check the target model's odds ratio and maintenance costs to avoid "being unable to afford, repair, or maintain"; During driving, it is important to maintain a good driving record and fully utilize the no compensation discount coefficient; When purchasing insurance, compare prices from multiple sources to find the most favorable pricing for your car model.