Auto insurance rates vary across the state of Illinois but average at $1322, as of December 2013. If you’re in Chicago you can expect to pay $1675 on an average. In Champaign you’ll pay $869 which is well below the statewide average. There are many factors that affect insurance premium rates such as age, gender, the type of vehicle you drive and so on. Your previous driving record is one of the main factors in determining your premium payments.

It’s well known that accidents drive up insurance costs. However, getting caught driving while under the influence (DWI) can drive up your insurance premium even more than accidents. To illustrate this point, let’s take the example of Chicago. If you live in Chicago and are involved in a car accident, your premium will rise from $1675 to $2063 on an average, as of December 2013. A second accident will drive your premium up to $3077.

On the other hand, if you are convicted of DUI your premium will shoot up to $3116. That’s $39 more than your premium after two accidents. And it doesn’t end there. Your premiums will remain at the higher rate for three years after conviction and will only revert to the original levels after seven years.

Completing a defensive driving course is one way to bring your premium payment down a little. Sticking to the example of Chicago, your premium will go down from $3116 to $2649 if you complete a defensive driving course. That means you are is still paying $586 more than you would if you’d had one accident. Drinking and driving can be a very expensive mistake. If you know you’ll be drinking on a particular night, it will be wiser to use a taxi service.

Residents of Illinois spent, on average, $505.32 on auto insurance in 1989. The figure has risen to $732.56 as of 2010. The average figure for 2010 ranks Illinois 24^th in the country based on insurance premium whereas it was ranked 21^st back in 1989. Illinois’ 45 percent increase in insurance rates is higher than the national average of 43.3 percent. However, when compared to states such as California (-0.3%), Hawaii (13.7%) and New Hampshire (15.9%), the rate change in Illinois represents a substantial rise in insurance costs.

A November 2013 study by the Consumer Federation of America found that states that had strong regulation of insurance rates were the most successful in keeping rates low. Illinois’ insurance rates changes are not regulated. There is no review of rates by the state and there is no requirement to file rate changes whether before or after use in the marketplace. As per the study, this lack of regulation has contributed to the higher increase in rates in Illinois when compared to states that have strong regulations.

The National Association of Insurance Commissioners (NAIC) auto database report of 2012 gives Illinois a Herfindahl–Hirschman Index (HHI) score of 1216. The Department of Justice considers a score of 1000-1800 as a moderately concentrated marketplace. A score of less than 1000 is considered a competitive marketplace. Illinois score of 1216 renders is only moderately competitive compared to states like California (753), New Hampshire (714) or Maine (633) which are highly competitive. Insurance costs are, thus, on the rise in Illinois in large part due to the paucity of strong regulation to keep rates low.