High car insurance premiums are worrying Americans. Check out who pays the most and who pays the least in America.
Why Americans Should Budget More For Auto Insurance In 2023
Here’s why you should pay more for car insurance in 2023
Frequently Asked Questions, USA TODAY
While car prices have skyrocketed during the pandemic, did you know that auto insurance has also skyrocketed?
According to researcher doxoINSIGHTS, 63% of Americans said they were most concerned about their ability to pay their car insurance, based on data from bill payment platform doxo, which spans more than 8 million paying consumers across 97% of U.S. zip codes. It’s connected to the internet and cable, and 73% of consumers said it was second only to utilities as they were most concerned about their ability to pay.
Not all are equal though. Car insurance is significantly more expensive in some states than others, but that doesn’t mean you can’t sleep well if you live in a state where costs are lower. Some low-cost auto insurance states are projecting sharp increases that could push rates to some of the highest in the country.
Using data from insurance company Insure, we analyzed which states currently have the highest rates, according to Germany-based car subscription service Finn, and what they expect to be in 10 years. Some may surprise you.
Which state currently has the highest car insurance rates?
1. Average annual premium in Florida: $2,560
“The Sunshine State is too expensive because Florida has the highest percentage of uninsured drivers,” Finn said in the report.
2. Average annual premium in Louisiana: $2,546
“Like Florida, Louisiana has a high percentage of uninsured drivers at just over 10 percent, which drives up premiums,” said Finn. “Even insured drivers often have minimal coverage, so they don’t protect you from anything more than a minor accident. Drivers in the Pelican State are very litigious, with more vehicle-related lawsuits contributing to higher insurance rates than any other state.”
3. Average annual premium in Delaware: $2,137
Because Delaware is small but crowded, “there are more accidents and higher repair costs, which increases insurance premiums,” Finn said. “The state’s wide coastline also increases costs because drivers are more at risk of severe weather causing accidents and vehicle damage.”
Which States Pay the Lowest Auto Insurance?
1. Average annual premium in Ohio: $1,023
Finn said a saturated and highly competitive insurance market not only helps keep premiums low, but also has many safer drivers. Ohioans can pay $625 less than the national average of $1,023.
2. Average annual premium in Maine: $1,116
Low population density reduces the likelihood of accidents, a very low rate of car theft and a small percentage of uninsured drivers help keep insurance rates low.
3. Average annual premium in Idaho: $1,121
Abundant rural roads and sparse populations reduce the chances of accidents. But the closer you get to big cities like Boise and Caldwell, the higher the average rate, Finn said.
Which states are projected to have the highest premium rates over 10 years?
1. Florida’s projected average annual premium for 2033: $4,813.
Finn said that if current trends continue, it will be $2,500 above the projected national average.
“Climate change will increase the cost of auto insurance in the state as more and more severe weather events increase the risk of vehicle damage and increase premiums,” he said.
2. Estimated average annual premium in Nevada: $3,055
If premiums continue to rise to their current 51%, by 2033 the Silver State will be ranked second.
3. Estimated average annual premium in New York: $2,990
Finn says auto insurance rates will increase by 48% over the next 10 years.
Looking for car insurance: Best Auto Insurance Companies: Expert Review June 2023
Are there places where car insurance rates drop?
Luckily, if you’ve lived in Georgia, Hawaii, or Michigan in the past 10 years, your annual costs have gone down.
1. Auto insurance premiums in Georgia fell 24% between December 2013 ($2,155) and 2023 ($1,647).
Beginning July 1, auto insurers in Georgia may be prohibited from raising rates at their discretion once the insurance reform bill passed by General Assembly is signed into law by Governor Brian Kemp. The law was passed after some auto insurers circumvented regulators through loopholes and raised rates by as much as 40% in one year.
2. Annual insurance premiums in Hawaii fell 17% from $1,583 in 2013 to $1,306 in 2023.
“Rates have fallen in the state of Aloha because insurance companies in Hawaii are no longer allowed to offer policies that take into account non-driving factors like age and credit score,” said Finn.
3. Interest rates in Michigan have fallen 15% from $2,520 10 years ago to $2,133 this year.
In 2020, lawmakers signed legislation limiting the situations in which drivers can sue each other for damages. Finn said fewer lawsuits helped reduce insurance costs.
Where can I find my state’s auto insurance premium ranking?
You can check out Finn’s full report here to see what the state is paying.
Medora Lee is a finance, markets and personal finance reporter for USA TODAY. You can contact her at [email protected] and she can subscribe to the free Daily Money newsletter, which provides personal financial information and business news every Monday through Friday morning.
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