A number of factors impact your car insurance premium, including your driving history, age and vehicle type. However, one other variable that affects it perhaps more than any other, and that is where you live. Car insurance rates by state vary significantly, often by hundreds or even thousands of dollars.
In addition, your ZIP code also factors into your car insurance rate. Each ZIP code represents a different level of risk to both the driver and the insurer. Whether it’s because of accidents, thefts or vandalisms, certain areas are simply more dangerous than others, which is why there are such discrepancies between some states.
If you’re shopping for car insurance, you may wonder how much the average cost is in your state. We’ve laid out the average rates for car insurance by state below. Read them over so you have an idea of the typical costs you can expect for each area.
Auto insurance rates by state
When you buy car insurance, you need to know your state’s requirements. Insurance companies won’t let you purchase less than your state’s minimum liability, but it’s a good idea to know what your state expects of you. For many states, minimum liability isn’t enough should you get into a serious accident. When medical costs exceed what you’re covered for, you’ll have to pay any remaining amount out of pocket.
Below, you’ll find a table with the average rates in each state. The figures under the ‘Coverage’ section signify the amount of required coverage using this format—bodily injury liability coverage, per person/bodily injury liability coverage, per accident/property damage coverage. The number under the ‘Average Car Insurance Rate’ column is the average amount of money drivers in that state pay for their insurance on an annual basis.
Here are the average car insurance rates by state so you can get an idea of how much you might pay.
|State||Minimum Coverage Requirements||Average Cost of Minimum Coverage||Average Cost of Full Coverage|
|District of Columbia||$678||$1,675|
When you look at the average auto insurance rates by state, remember that your price will vary based on factors like your age, driving history, location, vehicle and your eligibility for discounts. Don’t be surprised if you pay more or less than the average price. Instead, use these ranges to get an idea of how much is reasonable.
The most expensive states for car insurance
Florida currently holds the title for the most expensive car insurance rates in the nation. On a national level, the average rate for full coverage insurance comes in at $1,555. This compares to Florida’s average $2,587 for full coverage insurance, a difference of $1,032.
Why is it so expensive? First, the frequency hurricanes and flooding in Florida increases the cost of comprehensive claims. Secondly, Florida also accounts for the state with the most uninsured drivers at 26.7 percent.
As a no-fault state, a formula that inherently increases insurance rates, New York ranks as the state with the second highest full coverage rates in the nation. Additionally, increasingly common no-fault insurance fraud skyrocketed rates in the state.
Similar to Florida, Louisiana’s extreme weather translates to higher cost to insure vehicles. Additionally, with around 13 percent of drivers in the state uninsured, Louisiana rates remain high.
The cheapest states for car insurance
With an average annual premium of only $831, Maine is currently the cheapest state for auto insurance and also has the lowest percentage of uninsured drivers. The Insurance Information Institute in its latest study found that only 4.5 percent of drivers are uninsured. As a general rule of thumb, it’s less congested than other states, making it a safer place drive.
As a state with a strong insurance industry, Ohio ranks as the state with the second lowest car insurance rates in the nation. The sheer number of providers in the state brings insurance rates down as a byproduct of competition.
As a largely rural state with inherently fewer drivers compared to other states, reduced risk results in lower insurance costs. At the same time, however, 14.3 percent of drivers in the state don’t carry insurance.
Another factor impacting your car insurance rate is the type of state you live in. Some states are considered no-fault states, while others are at-fault states, or tort states. Below is a list of the 12 no-fault states:
- New Jersey
- New York
- North Dakota
In a no-fault state, your car insurance covers your vehicle’s damage and your medical payments after an accident, regardless of who caused the crash. In at-fault states, the driver responsible for the crash compensates the other driver for their losses. That’s the purpose of liability insurance.
Drivers in a no-fault state are required to carry an additional type of insurance, called Personal Injury Protection (PIP). PIP doesn’t replace your car insurance policy; it’s an add-on that you have to pay for in addition to your basic coverages. Because of that, living in a no-fault state can cause your insurance premium to be higher than it might be in other states.
How where you live affects your car insurance rate
Where you live significantly impacts your insurance rates. At the state level, insurance minimums and weather patterns affect what you pay. States with higher liability requirements and instances of inclement weather pattern claims typically pay more for car insurance.
For urban areas, factors like the average number of drivers on the road and the average commute time play a role too. The longer you drive each day and the more people on the road with you, the more opportunities for accidents. Because of this, less congested areas and areas with shorter commute times often have lower rates.
Car insurance by state also varies with the ZIP code, taking into consideration the prevalence of vehicle theft and other crime rates where the insured lives compared to the rest of the state.
Other factors considered in your car insurance rate
Where you live isn’t the only factor that goes into determining your auto insurance rates. Other factors include your:
- Credit score
- Driving record
- Marital status
- Car’s make and model
- State’s liability requirements
- Yearly mileage
- Claims history
Frequently asked questions
What is a tort state?
A tort state is the opposite of a no-fault state. In a tort state, only the driver considered at-fault is responsible for paying for medical coverage. This means with each accident, someone must always be found responsible for the cause of the accident.
Is car insurance required in my state?
Most states require some form of car insurance. Though some states don’t technically require it, every state requires you have enough in assets to cover the minimum liability requirements.
Most people aren’t willing to give up their house over a car accident and choose instead to purchase car insurance.
Is ZIP code-based insurance legal?
Yes, and when you think about it, it makes sense. If an insurance company knows that it is likely you will file a claim in the near future, that means you represent a higher degree of risk.
However, California has a law that prohibits insurance companies from using ZIP codes as the main factor in determining premiums. They may still use it as a factor, but it can’t be the one that carries the most weight.