Auto Insurance Rate Averages by State

Here is a chart of average auto insurance rates by state, via AARP.com, shaded by overage ranges. Click for an interactive map with more details and a ranking.

I wonder why rates in Louisiana are so high. $2,500 per year? Is it fear of flooding? Laws that encourage suing other drivers?

From the site: “Rates were calculated for more than 2,400 vehicles for model year 2010; based on a 40-year-old single male driver who commutes 12 miles to work; includes $500 deductible on collision and comprehensive coverage.” I wish they also shared how much liability coverage they chose, as that is the largest component of my premium.

Comments

  1. I find it fascinating that I am in Michigan, which is the second MOST expensive state.

    But next door is Ohio, which is 49th on the list and is the 2nd LEAST expensive state.

    One thing for sure, geographic region does not seem to play a critical roll.

  2. A company that insures autos in Louisiana probably also issues property insurance and other lines of insurance in the state. To survive as a company they may need to compensate for losses or risk on their other property insurance by raising their auto rates.

  3. Where did they come up with these figures? I have 3 cars insured in CA and none of them are as high as the figure for CA. In fact the most expensive which is for my teenage son is a little more than half the CA figure.

  4. No-fault states (you get hit by someone else and your insurance, not theirs, has to pay) almost always have the highest rates. I know Michigan is one, maybe Louisiana is another.

  5. Minnesota has a “No Fault” insurance law and is in the middle-of-the-pack at 29.

    In Minnesota, all drivers (except motorcycles) are required to carry no-fault insurance ((motorcyclists are required to carry liability insurance). Our no-fault law, as I understand it, covers quite a few benefits in the event of an accident (property damage, medical, wage loss, etc.) which your company pays to you as quickly as possible.

    The caveat is in regard to property damage, where if one driver is found to be wholly at fault, his/her ultimately company picks up the bill. If there is shared fault determined, insurers pay based on determined fault. And, if there is a dispute, after paying out to their clients, the insurers then battle one another.

    The goal is to get people reimbursed quickly so they may resume their lives and let the insurers deal with any legal battles.

    As for other reasons for having middle-of-the-pack rates in Minnesota, it certainly is NOT because of the outstanding drivers here. Each year, driver behavior seems to get worse (and are certainly not aided by our out-of-date and under-maintained road system).

  6. No-fault “should” reduce insurance costs because it keeps the lawyers out of the picture.

    It would be interesting to see the cost of Un/Underinsured motorist coverage in different places. It seems to be a growing problem, and hence a growing insurance cost.

    @Ron: Re Minnesota driving habits – I have lived in three states and driven in 20. I can assure you that, bad as you think they are, Minnesota drivers are far more courteous than just about anywhere else I have driven.

  7. @JD – When we moved to Sacramento from the Bay Area, our car insurance just about doubled.

    Anyway, these figures can vary WIDELY within states, too.

    IF you want to sum up Sacramento drivers, it’s “GET OUT OF MY WAY!!!” I have seen lots of road rage here, too. I never thought I Would call Bay Area driving “pleasant,” but now I do. I can only guess this has something to do with our auto insurance premiums.

  8. Yahoo! Glad I’m in a “dark green” state. Definitely encouraging for someone who might be getting a new (to me) car.

  9. These figures are not what the average person in the state pays for auto insurance. They are looking at what a 40 year old guy with certain cars and certain coverage would pay. I think its specifically for new 2010 cars as well which explains it being higher than you might think if you have an older cheaper car. Average spending is less than these figures.

    I found an article talking about the high rates in Louisiana that said:
    “Theories abound as to why the state’s insurance rates are so high. Some point to the litigious nature of Louisiana and poor driving habits. Others wonder about the rate of car thefts and vandalism.”

    And its not Katrina caused : “Insurance Commissioner Jim Donelon said the problem of high auto insurance rates in the state is not new; the state has been in the top 10 of car insurance prices for at least the two decades he has been monitoring the numbers. “

  10. in addition to being the second highest among the states, i don’t understand why our michigan premium keeps going up. mine on average increases roughly 10% at every renewal even though i’ve never had any ticket or claim.

  11. Roberta says:

    we live in Louisiana and I think one reason is the high
    numbe of uninsured.

  12. You should do an article on comparing auto insurances.

  13. Here I was thinking I was getting hosed in NJ with high property taxes and sales tax, while car insurance is really average..I also don’t pump my own gas

  14. I am glad to see Ohio in the lower level of the cost bracket. For some reason it appears all of our neighbors are getting hit with higher rates. Michigan..ouch…

    We must live in an invisible bubble that keeps all the bad drivers in surrounding states! ;)

  15. Here is a list of no fault states and their ranking in the list:

    Florida-25
    Hawaii-32
    Kansas-18
    Kentucky-19
    Massachusetts-45
    Michigan-2
    Minnesota-29
    New Jersey-22
    New York-23
    North Dakota-31
    Pennsylvania-26
    Utah -36

    With the exception of MI at the high end and MA at the low end, no fault insurance states tend to be in the middle of the pack.

    Why is my state so awful?

    BTW, here is the link to the list of no fault states.

    http://accident-law.freeadvice.com/auto/fault-no-fault-car-accidents.htm

  16. Joshua Rogers says:

    I’m inclined to think law and law enforcement must have a lot to do with it. I recently moved, and found the drivers in my new state are much more courteous on a whole, however there is a big cultural difference about drinking and driving. Here it seems more commonly acceptable to drive after a drink or two, and I’ve even been told that until recently it was legal to have an open container in the car (not sure I buy that one)

    I know thats a cultural difference, but its likely due to differences in law and law enforcement. Getting tossed in the slammer for DWI is a big difference than a ‘fine’.

  17. Not all no-fault laws are the same, Mike. There’s huge variation there.

    In some cases, all claims are “no fault.” In other states, only the medical portion is.

    In some cases, percentge of fault can be apportioned (even in “no fault” states like Florida).

  18. Okay Shane, then please compare the states laws versus each other and tell me if there are any trends, because I don’t see any yet. See below.

    Same source:

    States with Serious Injury Thresholds: In the following states, you can file a liability claim if you are at least relatively seriously hurt. The criteria of seriousness can be expressed in terms of a written description (e.g. permanent disfigurement, scarring, or fractured bones) or expressed in terms of length of disability (e.g. disability for more than 60 days).

    Injuries that qualify as serious are defined by each state’s law. The states that use severity as a threshold are:

    Florida
    Michigan
    New Jersey
    New York

    Even though all these states use severity as a threshold, Michigan is still far worse than the other three no fault.

    What gives?

  19. My father was in insurance for over 25 years. Louisiana was one of only three states in which the company would not do business. Apparently it had to do with a combination of an extremely unfriendly insurance commission along with a tendency toward civil legal forms (as opposed to the common law legal forms used in every other U.S. state), which are a result of the strong French heritage in the state. I guess that difference makes any legal disputes much more expensive (and insurance companies deal with more legal disputes than just about anyone else). I’m sure there are other factors as well, but I wouldn’t be surprised if its a competition issue if many of the large insurers don’t want to write policies there

  20. The no-fault laws are not what makes Michigan the second highest cost auto insurance state. It is the fact that Michigan is the only state in the country that mandates UNLIMITED LIFETIME medical benefits for auto related injuries.

    Also, there is no fee schedule for medical treatment and serices, which make it even more difficult to control costs.

    These are the issues any Michigan resident should discuss with their local and state elected officials.

  21. I’m not sure that I put too much faith in the AARP rankings. A few years ago when I moved from NC to AZ (the car theft capitol of America), my insurance rates doubled. Yet AARP has NC and AZ ranked equally.

  22. The problem here is this list isn’t entirely accurate. Average rates aren’ts imply that easy. Every company files base rates with the state. What isn’t included is private underwriting information.

    It’s how Progressive can “quote” you with another company (although it won’t be accurate). It’s just basic, generic information. I work in Insurance in Indiana, and I deal with a lot of out of state business in Michigan, Ohio, Kentucky, Florida, Texas and Arizona (don’t ask me why, that’s just the most common). Ohio/Indiana are VERY similar. Kentucky’s numbers are low here. As is Arizona’s. Again, I doubt this list takes credit into the equation like your actual insurance company does.

  23. I found this seem to be a bit inaccurate, course they’ll tell you that there’s factors that plays a role.

    9 years of driving experience, multiple vehicles, clean driving record, no points or accidents. Pay $650 for 6 months with Progressive in CA. Moved to Minnesota and insurance jump up to $1,200 for 6 months with the same coverages. So much for the so call Average by State chart.

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