The good news is that auto insurance premiums are, on average, becoming more affordable for the first time in 10 years, largely due to fewer claims because of the COVID-19 pandemic and the subsequent reduction in traffic. The bad news is they’re expected to jump back up next year as the nation (hopefully) gets back to normal, and claims rise due to more cars on the road and higher repair costs. That’s according to the State of Auto Insurance 2021 report compiled by the personal finance website ValuePenguin.com.
Overall, average auto insurance rates in the U.S. will decrease by 1.7% for 2021, with the largest drops expected in Arkansas (4.8%), Ohio (4.3%) and Michigan (4.3%). But not everyone will see cheaper car insurance bills this year. Premiums will rise by a slight amount in five states in 2021, led by New York and Indiana at 1.2% and 1.1%, respectively. The average annual cost to insure a car in the U.S. stands at $1,636, which is a whopping 106% higher than it was a decade ago.
In addition to a motorist’s driving record and personal factors like gender, age, and marital status, auto insurance rates are based on a person’s address. Generally, those living in outer suburbia and rural areas will pay less than motorists in urban areas where there is a greater probability of getting into a wreck and/or having a vehicle get damaged or stolen.
Beyond that, average rates will vary—sometimes dramatically—from one state to another. This is due to a number of variables, including crash/claim/crime rates, the number of uninsured drivers, the frequency of inclement weather, population density, the number of insurance companies doing business within a given state, the required minimum coverage amounts, and insurance industry regulations.
For example, those living in Maine will pay 40% less than the national average for car insurance, while Michigan residents will be charged a stiff 353% more than the norm for coverage. That’s an annual average out-of-pocket difference of $6,419. We’re featuring ValuePengiuin.com’s list of the 10 states in which motorists are charged the highest and lowest auto insurance rates below.
Of course no matter in which state you reside, experts advise shopping around among competing carriers periodically to see which one offers the lowest rates based on your personal information. ValuePenguin.com says premiums can fluctuate by as much as 242% between select insurance companies for a given motorist. Getting quotes is especially important if any of your personal factors has recently changed. This includes buying a new car, adding a second or third vehicle to your policy, adding or removing a driver from your coverage, becoming married or divorced, moving to a new address, or buying a house.
You should definitely shop around if you’ve gotten into an accident or have been issued a moving violation. ValuePenguin.com says getting a traffic ticket will trigger, on average, a 117% boost in car insurance rates, with getting a DUI being the biggest budget-buster at 157%. Again, this varies from one state to another, with North Carolina residents seeing the biggest boost at an average 255%; those living in Florida catch a break in this regard with only a 55% average rise in rates.
Here are the states in which motorists will pay the highest average car insurance premiums for 2021:
- Michigan: $7,406
- Florida: $2,795
- Rhode Island: $2,482
- Louisiana: $2,337
- Kentucky: $2,228
- Arizona: $2,152
- New York: $2,075
- Nevada: $2,047
- Delaware: $2,042
- Colorado: $1,992
And here are the states where drivers will enjoy the lowest average rates:
- Indiana: $987
- Iowa: $1,033
- Alaska: $1,034
- Wisconsin: $1,037
- Ohio: $1,043
- Virginia: $1,130
- Idaho: $1,132
- Vermont: $1,135
- Washington: $1,158
- Tennessee: $1,192
Click here for more state-specific auto insurance data.
World News || Latest News || U.S. News
Help us to become independent in PANDEMIC COVID-19. Contribute to diligent Authors.