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Consumer Price Index

Measuring Price Change in the CPI: Motor vehicle insurance

The motor vehicle insurance index, a component of the private transportation index, is included in the transportation group of the Consumer Price Index (CPI). The motor vehicle insurance index is published at the U.S. city average level.

Item definition

The motor vehicle insurance index covers physical damage, liability, and miscellaneous insurance coverage for private passenger vehicles. The major types of coverage included are collision, comprehensive, bodily injury liability, property damage liability, medical payments, uninsured motorist, and personal injury protection. All automobiles, vans, SUVs, and trucks that are eligible for private passenger vehicle insurance are included. Policies insuring motorcycles and assigned–risk policies are counted in the index’s weight but are excluded from pricing. Vehicles used primarily for business and policies written for farmers or ranch owners are excluded from the index.

Relative importance

The relative importance of an item category is its percent of the CPI weight as of December of the most recent year.

 Table A. Relative importance, December 2023
Item Relative importance

Private transportation


   New and used motor vehicles


   Motor fuel


   Motor vehicle parts and equipment


   Motor vehicle maintenance and repair


   Motor vehicle insurance


   Motor vehicle fees


Sample selection

The CPI replaces the entire motor vehicle insurance index sample all at once; most CPI components rotate 1/8 of the sample every half year. This index sample was last replaced in 2004. We select the sample of motor vehicle insurance carriers from a universe of companies provided by a national insurance trade organization based on the dollar amount of eligible private passenger motor vehicle insurance written by a company within each state. Policies for a sampled carrier within an area are selected from the total eligible motor vehicle insurance policies issued by the company within the area.

We work with respondents at selected insurance companies to choose actual policies that we follow over time. When policies are selected for pricing, we record characteristics of both the insured driver(s) and the insured vehicle(s) from the selected policy. Characteristics include vehicle age and description; geographic location where the vehicle is principally garaged; vehicle use purpose; miles driven annually; the types and amount of insurance covered by the policy; driver information and characteristics, such as age, sex, driving record, and marital status; and any applicable surcharges and discounts or other vehicle/driver related fees and charges. These data define the selected policy/policyholder/vehicle and the CPI holds the driver characteristics constant and follows prices over time. We use premiums calculated for the policies with these unchanging characteristics and not the actual premiums paid for the initially selected policies—since the characteristics and coverages for actual policies change over time.

Price change

Each month we collect the premium amounts for the selected polices in our pricing areas; approximately half in the even months and half in the odd months. To ensure that the full month is properly represented, pricing is spread out over three separate pricing periods covering the entire collection month.

Once a year, usually in October or November, the model year of each vehicle in our sample is updated by 1 year in order to keep the age of our sample vehicles constant; e.g., a 3-year old vehicle stays 3 years old from year to year. This annual updating process often results in premium changes. Some vehicles show premium decreases due to changes in the newer model, such as additional safety features or technological advances, which may lead to additional premium discounts. Other vehicles, due to higher expenses associated with a newer model such as the cost of repairs, show premium increases when their model year is updated. Premium changes due to this annual model year updating procedure are used in the index calculation. Consider, for example, a policy to insure a 2016 model year automobile that the CPI initiated into the motor vehicle insurance sample in early 2018. That automobile was 2 years old at the time, but in the fall of 2018, when 2019 models are introduced, the CPI changes the insured vehicle to a 2017 model so that it remains 2 years old. We reflect any resulting change in the premium due to this model year updating as a price change.

Sometimes insurance companies issue dividends to their policyholders either as a premium reduction or as a separate payment directly to the policyholder. The CPI shows reduced premiums for the effected priced policies as price reductions, but separate payments to the policyholder are not treated as price reductions, because we view such payments as income that can be used at the policyholder’s discretion.


Access data for motor vehicle insurance in our online database.

Additional information

Additional information may be obtained from the Consumer Price Index Information Office by email or calling 202-691-7000. Information on the CPI's overall methodology can be found in the CPI section of the BLS Handbook of Methods.

Last Modified Date: April 5, 2024