Car Insurance Rates by State

The 5 Cheapest and 5 Most Expensive States for Car Insurance

Car insurance premiums vary by state based on several factors. The three main factors include state regulations, population density, and taxation. States that require higher minimum coverage will have higher auto insurance premiums. Midwestern states typically have lower car insurance rates because the risk of accidents with lower population densities. Lastly, some states tax auto insurance policies, and the cost of insurance varies with the level of taxation.

The following list details the top five cheapest and the top five most expensive states for car insurance premiums based on the CarInsurance.com Premium Index for 2011.

Top 5 Cheapest States for Car Insurance

  1. Iowa: The state of Iowa’s average auto insurance premium in 2011 was $1,014. This is $525 cheaper than the national average of $1,539. It makes sense that Iowa tops the list for the cheapest car insurance in the United States because the state has a very low population density, and the required insurance liability limits are low.
  2. Hawaii: The state of Hawaii’s average auto insurance premium in 2011 was $1,120, $419 cheaper than the national average premium. Hawaii has a fairly dense population, but fewer residents own cars than the national average. Additionally, the state requires very low insurance liability limits.
  3. Maine: The state of Maine’s average auto insurance premium in 2011 was $1,129, $410 cheaper than the national average premium. Maine residents enjoy low car insurance premiums due to several reasons. Many drivers receive discounts for taking accident prevention courses, and the state’s drivers report low mileage, few uninsured drivers, and little highway traffic congestion.
  4. Idaho: The state of Idaho’s average auto insurance premium in 2011 was $1,156, $383 cheaper than the national average auto insurance rate. It is no surprise that Idaho’s insurance policies are lower than average because Idaho has one of the lowest population densities in the United States. It also helps that Idaho does not require drivers to purchase Personal Injury Protection.
  5. Wisconsin: The state of Wisconsin’s average auto insurance premium in 2011 was $1,167, $372 cheaper than the national average auto insurance rate. Wisconsin has a slightly higher population density than the national average, but its lower insurance rates may be due to the state’s regulations regarding insurance coverage since state does not require liability, collision or comprehensive insurance.

Top 5 Most Expensive States for Car Insurance

  1. New Jersey: The state of New Jersey’s average auto insurance premium in 2011 was $2,479, $940 more than the national average of $1,539. According to City-Data.com, New Jersey ranks as the most densely populated state in the country, so it is no surprise that it also ranks as the most expensive state in the country for car insurance.
  2. New York: The state of New York’s average auto insurance premium in 2011 was $2,380, $841 more than the national average auto insurance premium. The high rates are most likely due to population density and state regulations. New York has a high population density, and the state requires liability insurance, no fault personal injury protection, and uninsured motorist coverage.
  3. Washington, D.C.: The average 2011 auto insurance premium in Washington, D.C. was $2,282, $743 more than the national average auto insurance rate. The high insurance premiums are due to the heavy traffic in the region. Additionally, tourism is high, and there are many uninsured visitors on Washington, D.C.’s roads. The region requires high minimum coverage for bodily injury liability, property damage liability, and uninsured motorist protection.
  4. Rhode Island: The state of Rhode Island’s average auto insurance premium in 2011 was $2,279, $740 more than the national average auto insurance premium. Rhode Island is very densely populated, and the state requires uninsured motorist protection. Additionally, the state requires high minimum liability coverage for bodily injury and property damage protection.
  5. Delaware: The state of Delaware’s average auto insurance premium in 2011 was $2,203, $664 more than the national average auto insurance rate. The high rates are likely due to the state’s high population density and its popularity for drivers traveling from New York City or Philadelphia to Washington, D.C. Additionally, Delaware is a no-fault state. This means that Delaware residents are required to carry personal injury protection.