Which States Have the Lowest Rates for Car Insurance?

If you want to pay less for auto insurance, Maine is the place to be. Or Vermont, Iowa, or Ohio.

Those are just a few of the states that Insure.com ranks among the best in the nation for cheap car insurance.

On the other hand, states like Georgia, Michigan, and Oklahoma had some of the highest auto insurance premiums in the country. Drivers in Michigan, for example, pay an average of $2,098.29 per year, when the national average car insurance premium is $1,429.26.

So what is the most expensive state to insure a vehicle? Louisiana takes the cake with average annual premiums of $2,510.87. At the bottom of the list is Maine, where drivers pay an average of $902.85.

Validity of the Numbers

Several factors influence why car insurance rates vary so drastically among states.

A publicly traded company, Insure.com offers quotes and information on a variety of insurance policies, including car, life, health, and disability. Insure.com cautions that its figures should not be compared with those of the NAIC (National Association of Insurance Commissioners), which tracks what drivers actually spend on car insurance every year regardless of how expensive their state’s average policy is.

The NAIC numbers are the “gold standard that everyone follows,” John Oxendine, the Georgia Insurance Commissioner, said. When using the NAIC numbers, Georgia actually ranks in the “middle of the pack” consistently, Oxendine said, with the average amount spent per policyholder coming in at $782.

Factors Influencing Insurance Rates

One of the factors that results in such geographical disparities in car insurance rates is how populated a state is. For instance, Maine has very few residents, which means fewer people on the roads and fewer claims. Another factor is the rate of auto theft in a geographic area—higher theft rates will mean higher comprehensive auto insurance premiums. Finally, the likelihood and type of litigation of a particular state will influence liability premiums. Louisiana, the most difficult state to find affordable car insurance in, has a very complicated legal system that can get costly, and these costs are passed on to policyholders.

Ten Most Expensive States for Car Insurance

1. Louisiana: $2,510.87
2. Michigan: $2,098.29
3. Oklahoma: $1,869.39
4. Montana: $1,857.96
5. California: $1,774.41
6. South Dakota: $1,772.83
7. Washington, D.C.: $1,753.19
8. Georgia: $1,751.42
9. Illinois: $1,679.15
10. Connecticut: $1,678.90

Ten Least Expensive States for Car Insurance

1. Maine: $902.85
2. Vermont: $968.58
3. Ohio: $999.86
4. Wisconsin: $1,010.93
5. New Hampshire: $1,011.23
6. Iowa: $1,039.04
7. Massachusetts: $1,043.80
8. North Carolina: $1,130.45
9. Arizona: $1,152.50
10. Tennessee: $1,170.12