A new LexisNexis Risk Solutions report reveals that a shifting auto insurance landscape is reshaping the vehicle ownership journey, with significant implications for F&I operations.
First things first: The analytics and tech company’s 2026 U.S. Auto Insurance Trends Report—based on a survey of 3,000 U.S. auto insurance consumers—outlines five key trends shaping the current market as coverage costs become a bigger factor in vehicle purchase decisions.
Traffic violations remain elevated, with distracted driving violations up 57% between Q1 and Q3 2025 across all age groups.
Auto insurance is playing a larger role in purchase decisions, with 56% of consumers ranking it second only to the monthly car payment.
Auto insurance shopping hit record levels in 2025, with 47.1% of in-force policies shopped in the prior 12 months, up from 35.7% at the end of 2023.
A changing vehicle mix is increasing risk complexity, with 2020-and-newer model-year vehicles accounting for 30% of the insured population in 2025, up from 25% in 2024.
Bodily injury costs continue to rise, with frequency up 2.5%, severity up 7.5% and loss costs up 10.3% year over year—74% higher than in 2022.
What they’re saying: “After four years of continued rate increases, U.S. auto insurance consumers have become less loyal and more price sensitive,” reads the LexisNexis report. “Meanwhile, driving risk is no longer confined to high-risk violations and high-risk drivers, BI claims are reshaping claims outcomes and the changing composition of vehicles on the road is shifting the underlying risk landscape.”
Why it matters: Insurance affordability is becoming a bigger friction point in the buying process, making it increasingly tougher for dealership to close deals with a growing number of buyers who are already payment-sensitive about purchasing a vehicle.
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Between the lines: The changing insurance landscape reinforces the need for sales and F&I teams to prioritize insurance as part of the broader affordability discussion, with ownership costs continuing to climb.
Vehicle insurance costs have risen about 55% since 2020, while maintenance and repair costs are up roughly 47%, according to MarketWatch.
The average annual U.S. car insurance premium is $2,697, or about $225 per month, according to Bankrate.
The average cost to repair and maintain a vehicle driven 15,000 miles annually is $1,650 per year, or about $138 per month, based on AAA data.
Together, average insurance and maintenance costs now total roughly $363 per month—about half the average monthly car payment.
What they’re saying: “Buying a car today means looking well beyond the sticker price,” said Joon Um, a certified financial planner at Secure Tax & Accounting in Hayward, Calif., per MarketWatch. “Insurance, taxes, registration, fuel and maintenance can add a lot—especially with newer, tech-heavy cars that are expensive to fix.”
Bottom line: As insurance costs take a bigger bite out of household budgets, dealers that factor coverage costs into affordability discussions earlier in the sales process may be better positioned to prevent deal friction and keep buyers moving forward.
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