After several years of rising auto insurance premiums, Texas drivers saw a decrease in their car insurance rates in 2025. According to Insurify’s American Driver Report (ADR), the average annual cost for full-coverage car insurance in Texas dropped by 8% from 2024, amounting to $2,470 at the end of 2025. This represents a $205 reduction compared to the previous year.
Despite this decline, Texas remains among the more expensive states for car insurance. The state’s average premium was still 15% higher than the national average in 2025 and is currently 58% higher than it was in 2021.
Matt Brannon, Insurify senior economic analyst and author of the ADR, said, “The recent decline in Texas car insurance rates may be partly because vehicle theft, crash, and fatality rates have fallen in the state in recent years. But it’s likely that Texas is also benefiting from the trend we’re seeing nationwide. Insurers were focused on customer acquisition in 2025, and priced their policies competitively in many areas.”
Insurify data shows that after peaking at $2,708 per year in February 2025, Texas’ full-coverage average steadily declined throughout the rest of the year. Many insurers became profitable again during this period.
Major cities across Texas experienced similar declines. In Houston, premiums fell by 10%, dropping from $3,603 to $3,259 between 2024 and 2025. Dallas saw an 8% decrease to $2,852; Austin had a 4% drop to $2,480; Fort Worth premiums declined by 6% to $2,481; and San Antonio saw a similar reduction.
Several factors contributed to these lower rates. Preliminary data from the Texas Department of Transportation (TDOT) indicates that motor vehicle crashes decreased by more than 3% statewide in 2025. Fatal accidents dropped nearly 9%, while fatalities fell over 10%. Since 2021, fatal crashes have decreased almost 15%, with deaths down more than 16%.
Vehicle theft also impacts insurance costs. According to National Insurance Crime Bureau (NICB) data, Texas had the eighth-highest rate of vehicle theft nationally during the first half of 2025—123.83 thefts per 100,000 residents—but this marked a significant improvement: a decrease of about 25% compared with early 2024.
Looking ahead to next year, Insurify projects minor increases for both national and state averages: U.S. rates are expected to rise by about 0.6% while Texas could see a smaller increase of 0.3%. This would bring Texas’ average full-coverage premium up slightly from $2,477 at the end of this year to an estimated $2,484 by late next year.
The ADR notes that external factors such as prolonged tariffs on auto parts could lead insurers to raise premiums further if claims costs increase.
