Auto insurance. It’s a necessary evil to owning a vehicle in the United States, and not everything is equal. Prices vary depending on a wide range of factors, some of which make sense such as levels of coverage. Other factors are more controversial, with many people arguing that facets such as age, location, and credit scores boil down to outright discrimination. Wherever you stand on the issue, one thing is certain – prices for auto insurance can vary greatly simply based on where you live.
To make that come alive for you, Carinsurance.com took a deep dive into average insurance costs for both cities and states throughout the United States. The website conducted quotes with six major insurance carriers, using a 2017 Honda Accord for the car and a 30-year-old male with a clean driving record as the driver. The quotes were for insurance policies meeting minimum state requirements for liability coverage with a $500 deductible.
Which cities are the most expensive? Michigan is notoriously costly with its no-fault insurance system, and as such, Detroit leads the pack by a wide margin. The average insurance cost is a whopping $6,329, which equates to $527 per month – roughly the same as a car payment for a brand-new vehicle in the $35,000 range. New York is second at $5,703 annually, followed by New Orleans at $4,601 and Las Vegas at $3,768. Closing out the top-five is North Hollywood at $3,767 – nearly half the cost of insuring a car in the Motor City.
By contrast, Bridgewater, Maine has the cheapest insurance rates in the nation at just $993 per year. Lebanon, New Hampshire and St.Marys, Ohio tie for second at $995, with Blacksburg, Virginia at $1,005 and Menasha, Wisconsin at $1,080. Again, these figures are all based on the same 2017 Honda Accord with the same 30-year-old male as the driver. So yeah, there's a tremendous difference in cost based simply on location.
According to this report, the average annual insurance cost for the entire U.S. is $1,700.
CarInsurance.com’s 2020 Average Rate Tool Helps Drivers Identify Savings in their ZIP Codes
The site’s newly updated car insurance ZIP code calculator lets users compare rates from up to six insurers and estimate savings that can be as much as $1,700
Foster City, CA – February 26, 2020 – CarInsurance.com, a one-stop destination for unbiased, expert advice on car insurance, today released an updated version of its average car insurance rate tool, which provides quotes for three coverage levels and multiple ages based on ZIP codes.
Drivers can enter a ZIP code in CarInsurance.com’s average car insurance rates tool to see the average premium for their location, as well as the highest and lowest rates. The difference between the highest and lowest rates is the amount you can potentially save on a policy by comparison shopping for the lowest price.
"We encourage drivers to scrupulously comparison shop, so they aren’t leaving possibly hundreds of dollars on the table,” said CarInsurance.com Editorial Director Michelle Megna. “Let’s look at Portland, Oregon, ZIP code 97232 as an example, because it has the same average rate as that of the nation. When using the ZIP code calculator we discovered a difference among insurance providers of $1,723 between highest and lowest estimates. That’s a big number for many families, and can make a huge and positive impact on everyday budgets.”
The data shows that the average rate for full coverage has gone up 22% since 2017, which is the last time CarInsurance.com updated the rates by ZIP code tool. The current national average for full coverage is $1,758. However, the state-required minimum coverage is up just 4% since 2017, and standard liability limits have gone up 16%.
By comparison shopping, the average savings for a full coverage policy is up to $1,647, based on CarInsurance.com’s analysis of rates for nearly every ZIP code in the country
Why focus on ZIP codes
ZIP codes tell insurers the risk level to cover consumers, based on the number and severity of car insurance claims in a local area. While factors like the driver’s age, driving record and kind of car are also factored in, the ZIP code surprisingly reigns supreme.
CarInsurance.com finds that the most expensive ZIP codes are in Detroit (48226), New York City (11212), and New Orleans (70117). The least expensive are located in Bridgewater (ME - 04735), Lebanon (NH - 03766) St. Mary’s (OH – 45885) and Blacksburg (VA - 24060).
Use the ZIP Code Calculator and read the full report on CarInsurance.com. Michelle Megna is available to comment on how consumers can save money when shopping for auto insurance.