Auto insurance premiums are part of the lives of nearly 230 million US drivers. The cost of car premiums can vary widely, not only from person to person, but also much broader, such as the state in which you drive. Six of the 10 most expensive states for auto insurance premiums were also among the 10 highest states in population density. Only Louisiana was a state with a premium cost above 10 and a population density in the lower half of the Census Bureau's density ranking.
We also found that the opposite applies to most of the cheaper states for auto insurance. As defined by the Census Bureau, 81% of Americans live in urban areas. Average disposable income was not such an obvious factor, at least at the state level. Only four of the 10 most expensive states for auto insurance premiums across the Northeast Corridor were states with average incomes higher than the national average.
States with the lowest average income, such as Georgia, Louisiana, Michigan, and South Carolina, also have some of the highest premium costs. Auto insurance rates also vary by region and state, the report revealed. Louisiana experienced the largest average increases in auto insurance rates at 42%, making it the most expensive state for auto insurance. On the other hand, Maryland has seen the most significant decreases in average auto insurance rates, from 9%.
In addition to a high percentage of uninsured motorists, Florida's frequent exposure to natural disasters causes insurers to charge more than they charge in states with more stable weather. About half of all states require some form of uninsured or underinsured coverage, and 15 states require PIP. This means that if your car is a favorite of car thieves or ends up in more crashes, you'll pay more for car insurance, regardless of whether you ever made a claim. If living in a state with affordable car insurance premiums is important to you, these states are some of the cheapest places or car insurance.
A very recent change in car insurance laws affects future costs, but some worry that some rates could go even higher. One of the reasons for the low insurance costs could be that Massachusetts claims the eighth-best public transportation system in the country, which encourages citizens to use public transportation instead of their cars. While the state has a low crime rate, Connecticut has the eighth highest cost of living in the country, contributing to high insurance rates. Hawaii also has fewer licensed drivers than 42 other states, says Statista, which could contribute to lower car insurance rates.
Cheap car insurance in Pine Tree State may be due to the state's low population density, low case fatality rate on state highways, low number of licensed drivers, and low cost of living. We found that State Farm, American Family, and Erie offer the cheapest rates for minimal coverage, so Wisconsin drivers looking for affordable rates should consider these three insurers. The true cost of car insurance is reflected in the percentage of income drivers allocate to car coverage each year, rather than how much they spend on premiums, according to financial services firm Bankrate. Check with your insurer or agent to ensure that all available discounts apply to your policy.
Low vehicle maintenance costs, low cost of living and low population density can contribute to lower insurance costs. In fact, rates fell in almost every state (rose or stayed the same in nine states), illustrating how COVID-19 drastically impacted auto insurance rates. .