I’ve been a CPA since 1981, and writing about money for 35 years. I’ve watched insurers get very good at one thing: figuring out which customers won’t shop around.
Your renewal notice looks like a routine bill. For some insurers, it’s something else: a test of how big an increase you’ll accept before you start shopping.
That test is getting more expensive to fail. The average full-coverage policy now costs about $2,256 a year, up 3% from last year and roughly 75% since 2016, according to The Zebra’s 2026 State of Insurance report.
And on Sept. 2, Texas formally told insurers that the pricing trick behind that test breaks state law.
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The pricing practice Texas just called illegal
On Sept. 2, the Texas Department of Insurance issued a bulletin to every insurer in the state about something regulators call “price optimization.” The bulletin defines it as varying premiums based on factors unrelated to your risk of loss, to charge “the highest price that policyholders will tolerate before shopping for a new policy.”
In plain English: two drivers with the same record, the same car and the same ZIP code can get different renewal increases, because a computer model predicts one of them is less likely to shop around. The Texas bulletin puts it bluntly: “Price optimization turns loyalty into a pricing factor.”
Gov. Greg Abbott was just as direct: “Insurance companies must base rates on risk, not on how much extra money they think a customer will pay.” Texas says it will take enforcement action against insurers that don’t comply.
Here’s what matters if you don’t live in Texas. On Sept. 22, the Consumer Federation of America wrote to insurance commissioners nationwide, urging them to follow Texas’s lead.
By the group’s count, 20 states plus Washington, D.C., have issued bulletins against the practice, many of them more than a decade old. The other 30 states have issued none.
Insurers don’t disclose whether they use this kind of pricing, and you won’t see it on your bill. The only way to know whether your renewal price is fair is to compare it with what other insurers would charge you for the same coverage.
Is your renewal priced on your risk or on your loyalty? There’s one way to find out: compare it. See if you’re overpaying — free, 5 minutes
Why a rate cut might not reach your mailbox
Here’s the frustrating part of 2026. Some insurers are cutting rates. According to LexisNexis Risk Solutions, 35% of the rate changes insurers made in the first quarter were decreases.
But a lower filed rate doesn’t guarantee your renewal goes down. As David Seider, chief commercial officer of The Zebra, put it this year: “Targeted rate reductions will help, but most renewals will see rates staying high.” LexisNexis found something else telling: rate decreases are less likely to prompt people to shop than rate increases.
When your bill holds steady, it’s easy to let it renew. That’s exactly when a better price elsewhere goes unnoticed.
What smart insurance shoppers do at every renewal
More drivers are onto this. LexisNexis reports that 47.3% of auto policies were shopped at least once in the past 12 months, the highest share since it began tracking in 2020.
Drivers 66 and older are leading the way, with shopping growth among that group ahead of every other age group for 13 straight quarters. And shoppers are getting more thorough: J.D. Power’s 2026 Insurance Shopping Study found that shoppers now collect an average of 3.5 quotes, the most in the study’s history.
Here’s what they do:
1. Compare at least three quotes for identical coverage. Same liability limits, same deductibles, same drivers and vehicles. Otherwise you’re comparing apples to oranges, and a “cheaper” quote may simply buy less protection.
2. Check the bundle, both ways. J.D. Power found that 45% of car insurance shoppers also own a homeowners policy, but only 20% got a homeowners quote while shopping. Bundling can cut costs, but sometimes two separate insurers beat one bundle. You only know by pricing both.
3. Revisit your deductible. According to the Insurance Information Institute, raising your collision and comprehensive deductible from $200 to $500 could cut those costs by as much as 30%, and going to $1,000 could save more than 40%. Just make sure you keep enough in savings to cover the higher deductible if you need it.
4. Re-shop after any life change. Moving, paying off a car loan, retiring from a daily commute or removing a driver from your policy can all change your price. Your current insurer won’t always adjust automatically.
5. Ask about usage-based discounts. About 20% of customers now use programs that price insurance on how and how much they drive, according to J.D. Power. If you drive less than you used to, it may be worth a look.
Ready to compare your renewal? See if you’re overpaying — free, 5 minutes
What to have handy before you compare
Comparing quotes goes faster when you have three things in front of you:
- Your current declarations page, the summary page of your policy showing your coverage limits and deductibles, so every quote matches what you have now
- Your renewal notice, so you know exactly what you’ll pay if you do nothing
- Driver’s license numbers and vehicle information for everyone on the policy
Comparing costs nothing, and you’re under no obligation to switch. If your current insurer turns out to have the best price, you’ve confirmed you’re getting a fair deal. If not, you’ve found money you were handing over for nothing.
Save $1,100 on Your Car Insurance
Are you still paying renewal rates on your car insurance? If so, you are probably throwing away money. Insurers count on you being too busy to shop around. But Insurify has fixed that.
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Own a home? Check that renewal too
The Texas bulletin isn’t limited to car insurance. According to the governor’s office, price optimization violates Texas law for every type of insurance the state regulates, and Gov. Abbott singled out homeowners coverage: the average annual homeowners premium in Texas rose 79% in six years.
The same renewal rules apply to your home policy. Compare identical coverage, including the same dwelling limit and deductible, and price your home and auto policies both bundled and separately before you decide.
Stop overpaying for home insurance
Home insurance rates have exploded — and if you haven’t shopped around lately, you’re almost certainly paying too much. Loyalty doesn’t pay; your insurer is counting on you never checking.
Fight back with Insurify Home Insurance. Insurify is a free marketplace that pulls real quotes from dozens of top insurers side by side — see your rates in minutes. No endless forms, no spam calls, no obligation — just your best rate. Ten minutes now could save you hundreds every single year. Compare quotes right now
The Bottom Line
At an average of $2,256 a year, car insurance is one of the biggest bills you pay on autopilot. And regulators in Texas have now said in writing what consumer advocates have argued for more than a decade: some insurers treat loyalty as a reason to charge more, not less. If you live in one of the 30 states with no rule against the practice, checking your renewal price is up to you.
The drivers who come out ahead don’t wait for a big rate hike to act. They compare at every renewal, match coverage line for line, and let the numbers decide. Nearly half of all policies were shopped in the past year, a record according to LexisNexis, and J.D. Power reports the median premium moving between insurers now tops $3,200 a year. Your renewal date is the natural deadline. Check before you pay, not after.
Save $1,100 on Your Car Insurance
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