Yahoo Autos Where It's Cheapest And Costliest To Obtain Car Insurance
Detroit, Michigan (Photo: Satya Murthy | Flickr)
Despite the proliferation of fast-food chains and big-box department stores, America is a land of diversity in its culture, its ethnicity, and – especially – its car insurance rates.
While auto premiums are largely based on personal factors, including one’s driving record, age, gender and so forth, and some cars are inherently cheaper or more expensive to cover, where a driver lives can have a significant impact on his or her rates.
We’re not suggesting anyone pick up and move across country to obtain cheaper car insurance, but those living in Michigan might want to start checking out real estate listings elsewhere, as residents of the Wolverine State pay the highest premiums in the nation at an average $2,738 annually. That’s according to the insurance shopping website Insure.com’s annual survey of auto insurance rates, and it’s nearly double the national average of $1,325.
At the other end of the spectrum, residents of Maine enjoy more than just cheap lobster – they also pay the lowest insurance rates in the nation at an average $808, which is about $500 less than the norm.
“Most of the least expensive states don’t have as large metropolitan areas as the most expensive group. With less congestion comes fewer accidents and less risk for insurers,” says Insure.com consumer analyst Penny Gusner. “It’s one of the most straight-forward aspects lowering car insurance premiums in those states.”
Other factors also come into play, including crime rates, the number of uninsured drivers, and the number of insurance companies doing business within a given state. The latter works to the advantage of Ohioans, who pay among the lowest rates in the nation at an average $900 a year. “Ohio has an extremely competitive insurance industry,” Gusner explains. “There are more than 650 issuers competing for business within the state.”
State and local laws and regulations are another major factor in determining rates, with some states being more or less “friendly” to consumers or insurance companies. For example, Insure.com cites Michigan’s no-fault auto insurance laws – particularly its mandated no-limit personal injury coverage – as a determining factor to its sky-high rates. “Michigan’s no-fault requirement, while trying to curb insurance fraud, causes astronomical rates,” says Gusner. “It then creates a high percentage of drivers who cannot afford to be insured – raising rates even more so.”
These are the 10 most expensive states for car insurance in 2016 according to Insure.com:
Michigan, $2,738
Montana, $2,297
New Jersey, $1,905
Louisiana, $1,842
Oklahoma, $1,778
DC, $1,773
California, $1,752
Florida, $1,654
Maryland, $1,610
Rhode Island, $1,608
And here are the 10 cheapest states in which to obtain auto insurance this year:
Maine, $808
Ohio, $900
Wisconsin, $912
Idaho, $935
New Hampshire, $941
Vermont $942
North Carolina, $987
Iowa, $989
Virginia, $1,020
Illinois $1,035
Click here for further details and an interactive map of the U.S. with average premiums detailed by state.
Stonington, Maine (Photo: jar [o] | Flickr)
The Fine Print: Data was compiled during February 2016 by Quadrant Information Services based on auto insurance rates from six large carriers (Allstate, Farmers, GEICO, Nationwide, Progressive and State Farm) in 10 ZIP codes per state. Premiums were computed and averaged based on the 20 best selling vehicles in the U.S. to avoid high-rate sports cars and luxury vehicles from skewing the results.
All estimates are based on full coverage for a single, 40-year-old male with a clean driving record and good credit who drives 12 miles to work each day, with policy limits of 100/300/50 ($100,000 for injury liability for one person, $300,000 for all injuries and $50,000 for property damage in an accident) and a $500 deductible on collision and comprehensive coverage. Your rates may vary.
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