Is Car Insurance More Expensive Depending On Where You Live?
There are many factors that go into how much you pay for car insurance, from your driving history to your age. But did you know where you live also plays a signifant role in how much you pay?
Introduction
Car insurance can be a tricky topic. There are a lot of factors that can impact whether you get coverage, who is or isn’t covered, and how much you may pay for it all.
We’ve covered several topics ranging from whether car insurance follows the car or the driver to even if having a red car increases the cost of your car insurance or not (spoiler: it doesn’t). Today, our GPS is directing us toward a new topic: location. More specifically, does the cost of car insurance vary based on where you live?
Does Where You Live Impact Your Car Insurance Rate?
Car insurance rates can be determined by several factors, most of them specific to you — the driver — including your:
- Insurance carrier
- Type of vehicle
- Driving record
- Age
- Amount and type of coverage
- Credit score
Another factor that insurance companies consider when determining your rate? Where you live. Car insurance premiums vary from state to state and sometimes even between different locations within one state. So your car insurance can cost one amount while your friend that lives in the next city over on the map pays a different amount. This is for a variety of reasons.
Why Rates Differ So Much From Location to Location
As your favorite realtor probably prints on their business cards, it’s all about location, location, location. And it’s not any different when it comes to the cost of your car insurance.
Insurance companies may consider many factors related to your location when determining your rate. Along with each state's minimum car insurance laws and requirements, those factors may also include road conditions, the number of drivers in the area, the percentage of uninsured drivers, and even the number of claims from weather-related incidents in that zip code.
State-By-State Breakdown
Are you curious how your state measures up when it comes to car insurance costs? The chart below breaks down the average annual car insurance premiums for both full coverage and minimum coverage in each state (and Washington D.C.). The minimum liability coverage limits are also listed as three numbers, representing (in order) the state’s liability coverage requirements for: bodily injury liability per person, bodily injury liability per accident, and property damage liability per accident.
State |
Minimum liability coverage limits (in thousands) |
Average annual cost of full coverage |
Average annual cost of minimum coverage |
Alabama |
25/50/25 |
$1,843 |
$441 |
Alaska |
50/100/25 |
$1,946 |
$421 |
Arizona |
25/50/15 |
$1,810 |
$587 |
Arkansas |
25/50/25 |
$1,907 |
$443 |
California |
15/30/5 |
$2,291 |
$636 |
Colorado |
25/50/15 |
$2,121 |
$500 |
Connecticut |
25/50/25 |
$1,553 |
$620 |
Delaware |
25/50/10 |
$2,103 |
$801 |
Florida |
10/20/10 |
$3,183 |
$1,128 |
Georgia |
25/50/25 |
$2,085 |
$639 |
Hawaii |
20/40/10 |
$1,275 |
$344 |
Idaho |
25/50/15 |
$1,133 |
$267 |
Illinois |
25/50/20 |
$1,806 |
$552 |
Indiana |
25/50/25 |
$1,295 |
$327 |
Iowa |
20/40/15 |
$1,315 |
$223 |
Kansas |
25/50/25 |
$1,878 |
$416 |
Kentucky |
25/50/25 |
$2,124 |
$678 |
Louisiana |
15/30/25 |
$2,909 |
$805 |
Maine |
50/100/25 |
$941 |
$225 |
Maryland |
30/60/15 |
$1,971 |
$815 |
Massachusetts |
20/40/5 |
$1,262 |
$429 |
Michigan |
50/100/10 |
$2,691 |
$1,104 |
Minnesota |
30/60/10 |
$1,760 |
$585 |
Mississippi |
25/50/25 |
$1,771 |
$446 |
Missouri |
25/50/25 |
$1,943 |
$490 |
Montana |
25/50/20 |
$1,889 |
$310 |
Nebraska |
25/50/25 |
$1,624 |
$359 |
Nevada |
25/50/20 |
$2,779 |
$973 |
New Hampshire |
25/50/25 |
$1,262 |
$319 |
New Jersey |
25/50/25 |
$1,754 |
$782 |
New Mexico |
25/50/10 |
$1,591 |
$346 |
New York |
25/50/10 |
$3,139 |
$1,371 |
North Carolina |
30/60/25 |
$1,446 |
$432 |
North Dakota |
25/50/25 |
$1,302 |
$269 |
Ohio |
25/50/25 |
$1,266 |
$338 |
Oklahoma |
25/50/25 |
$1,998 |
$406 |
Oregon |
25/50/20 |
$1,415 |
$616 |
Pennsylvania |
15/30/5 |
$2,040 |
$428 |
Rhode Island |
25/50/25 |
$1,886 |
$551 |
South Carolina |
25/50/25 |
$1,532 |
$524 |
South Dakota |
25/50/25 |
$1,553 |
$276 |
Tennessee |
25/50/25 |
$1,429 |
$371 |
Texas |
30/60/25 |
$2,019 |
$565 |
Utah |
25/65/15 |
$1,510 |
$539 |
Vermont |
25/50/10 |
$1,061 |
$238 |
Virginia |
30/60/20 |
$1,439 |
$494 |
Washington |
25/50/10 |
$1,410 |
$515 |
Washington, D.C. |
25/50/10 |
$2,072 |
$607 |
West Virginia |
25/50/25 |
$1,580 |
$421 |
Wisconsin |
25/50/10 |
$1,292 |
$358 |
Wyoming |
25/50/20 |
$1,582 |
$263 |
Quadrant Information Services, 2023 as cited by Bankrate.com
Tips for Reducing Insurance Costs
Now that you have an idea of how your home state compares to the others, what can you do about it? Short of packing up and moving somewhere else, there isn’t much you can do regarding the impact your location has on your insurance rate. However, there are other parts of the equation that you do have control over such as your credit score or your ability to drive safely. Some other ways to potentially lower your insurance costs include:
- Shopping around for a lower rate: Insurance companies use similar factors to calculate your rate, but they each may weigh those factors differently. So that means rates vary from company to company. Shop around to find the one that fits your budget.
- Adjusting your current plan: Review what’s in your plan and consider ways to lessen the cost such as dropping unnecessary types of coverage, or increasing your deductible. Just be aware of the other side of the coin if you make these adjustments. For example, while a higher deductible typically comes with a lower premium, you must also be prepared to pay more yourself if you get into an accident. So don’t adjust too far and put yourself in a position where you face paying more out of pocket than you can afford.
- Getting a more insurance-friendly vehicle: Car value, cost to replace or repair, popularity to thieves, and safety features all go into the equation. So, if you’re looking to reduce your insurance costs, consider a safe and moderately priced vehicle as opposed to something a little flashier and more expensive.
- Searching for discounts: Insurance companies may offer ways to save. Check to see if they have a discounts page on their website or offer savings for actions like opting to go paperless or installing their app on your mobile phone. You may also be able to get a multi-car discount if you have multiple cars in your household to enroll. You’ll never know if you don’t search around.
Bottom Line
When it comes to the cost of your car insurance, where you live can have a significant impact in determining what you pay. And, while there isn’t much you can do about it (short of moving somewhere else), knowing the different location-related variables that insurance companies consider could help you make other decisions to save a few bucks, such as the type of coverage you select or even the car you drive.
Regardless of where you live, always be sure to review your policy. Credit One Insurance allows you to compare rates from over 40 carriers instantly to find the best option for you.
About the author:
With his eyes set on becoming the next great ad man (at least until his comedy writing career took off), Marc earned his journalism degree and went straight into advertising for various gaming and tourism clients. He later expanded his credentials to include public affairs and communications work for several environmental science organizations before returning to his marketing roots. A lifelong scholar with recent studies in strategic communication, Marc enjoys tying humor into his writing and simplifying complex financial subjects into engaging and easy-to-digest content for a wide variety of audiences.
