Louisiana is No. 1 -- but not in a desirable way. It has
the highest average car insurance rates in the nation, followed by
Michigan and Georgia, according to Insure.com's annual
state-by-state comparison of insurance premiums.
Maine enjoys the least expensive car insurance rates, followed
2013 state rankings of car insurance rates
Avg. annual premium*
|| $ 2,699
|| $ 2,520
|| $ 2,155
|| $ 2,074
|| $ 2,006
|| $ 1,914
|| $ 1,819
|| $ 1,816
|| $ 1,735
|| $ 1,725
|| $ 1,723
|| $ 1,697
|| $ 1,667
|| $ 1,638
|| $ 1,625
|| $ 1,604
|| $ 1,586
|| $ 1,583
|| $ 1,545
|| $ 1,545
|| $ 1,528
|| $ 1,510
|| $ 1,501
|| $ 1,496
|| $ 1,455
|| $ 1,438
|| $ 1,435
|| $ 1,432
|| $ 1,431
|| $ 1,408
|| $ 1,397
|| $ 1,387
|| $ 1,384
|| $ 1,369
|| $ 1,364
|| $ 1,345
|| $ 1,341
|| $ 1,322
|| $ 1,322
|| $ 1,288
|| $ 1,271
|| $ 1,228
|| $ 1,227
|| $ 1,226
|| $ 1,183
|| $ 1,176
|| $ 1,133
|| $ 1,112
|| $ 1,106
|| $ 1,085
|| $ 1,028
|| $ 934
* Dollar figures shown are an average of insurance rates for
more than 750 vehicles in the 2013 model year.
Louisiana and Michigan have held one of the top three positions
since Insure.com began its annual survey in 2010. Georgia rose from
the No. 10 position in 2012 to this year's third-place spot,
bumping Oklahoma to fourth place.
Maine and Iowa held the bottom two spots on the list last year
and have been in the bottom 10 since 2010.
A variety of factors make
rates more painful in some states than others -- the number of
insurers competing for business, driving conditions, the portion of
drivers who are uninsured, and the way state insurance systems are
No. 1: Louisiana
Compared to the rest of the country, Louisiana drivers who get
in accidents file more bodily injury claims than drivers in other
Louisiana also has a high rate of comprehensive claims, which
include damage from natural disasters, says R. Parke Ellis,
president-elect of the Independent Insurance Agents & Brokers
of Louisiana and chairman of Gillis, Ellis & Baker Inc. in New
In addition, a greater portion of people filing insurance claims
hire attorneys, says Barry Blumberg, president of the Independent
Insurance Agents & Brokers of Louisiana and president and CEO
of Blumberg and Associates Inc. in Baton Rouge.
Louisiana's judicial system may also be to blame for high rates.
Lawsuits involving claims under $50,000 go before judges instead of
juries. Some observers say elected judges are more likely to side
with local people than insurance companies.
No. 2: Michigan
Michigan is the only state in the country that guarantees
unlimited, lifetime personal injury protection (PIP) benefits for
treatment of injuries from a car accident.
Other states don't even come close, observes Jeremy MacDonald,
vice president of the Michigan Association of Professional
Insurance Agents and president of the Mid-Michigan Agency Inc. in
Alma. Florida caps PIP benefits at $10,000, for instance, and New
York at $50,000.
MacDonald says an instructor at an insurance course for agents
once quipped, "'I tell my wife if I have a heart attack, put me in
the car and roll it into a tree.'"
Car insurance customers must buy PIP as part of the policy. PIP
pays the medical bills for car accident injuries of the
policyholder, family members in the household and any passengers
who do not have PIP coverage. The injured person's car insurance
company pays out the first $500,000 for medical treatment. Any
expenses above that threshold are reimbursed by a state-created
nonprofit called the
Michigan Catastrophic Claims Association
A portion of everyone's premium includes an assessment from the
association, which this year is $175 per vehicle.
Last year a bill to set limits on PIP benefits failed, but
legislators are expected to introduce another reform bill backed by
Gov. Rick Snyder in March.
In addition to setting a cap on benefits, reform proponents have
called for capping payments for medical services. Reimbursement
costs for PIP claims are about three times the reimbursement costs
for workers' compensation and four times the reimbursement costs
for Medicare --
for the same procedures
, according to the Insurance Institute of Michigan. The average PIP
medical claim more than tripled to $44,138 in 2012 from $13,617 in
2000, the institute says.
Still, efforts to change the system face a tough fight from
hospitals, patient advocates and some elected officials, such as
Oakland County Executive L. Brooks Patterson, who was critically
injured in a car crash in August. In an
open letter to the public
, Patterson vigorously defended the state's current auto insurance
The political fight is often portrayed as the "big, bad
insurance companies" being stingy versus accident victims who rely
on the money for survival, says Jason Verlinde, treasurer of the
Michigan Association of Professional Insurance Agents and vice
president of the Verlinde Insurance Agency in Richmond.
"But the people who are getting lost in the story are the ones
who can't afford it," he says.
He tells of a single mom who recently scraped enough money
together to buy a used car and came to see him to buy auto
"It was a great day for her because she was finally able to get
transportation to change her life," he says. "But the premium was
$2,600 a year for the bare-minimum coverage. That includes no
collision or comprehensive, and she can't afford it."
No. 3: Georgia
Victor Hamby, president of the Professional Insurance Agents of
Georgia, says the market in the Atlanta metropolitan area was
"ultra competitive" from about 2003 to 2010.
Then things took a turn.
"The carriers underpriced the market, and claims caught up with
them," he says. "We're seeing carriers increasing rates on auto
insurance for the first time in seven or eight years, anywhere from
2 to 12 percent. We're seeing some hardening in the market."
But plenty of companies are still competing in Georgia, says
Hamby, personal lines and bonds manager at Hamby & Aloisio Inc.
"And that's a great thing," he says. "The regulatory environment
is conducive to insurance companies writing car insurance. We're
working hard to keep the marketplace in Georgia vibrant and
Donna Marcus-Doughten, president-elect of the Professional
Insurance Agents of Georgia, agrees that Georgia has a healthy,
competitive market. But she says traffic is terrible in the Atlanta
area, which may lead to more fender-benders.
"It's bumper to bumper across six lanes," says Marcus-Doughten,
vice president of Phoenix Associates in Marietta.
No. 50: Iowa
Iowa's rural sensibilities help keep rates down in the Hawkeye
State, insurance agents say. The population of Des Moines, the
largest city, is about 200,000.
"I don't think we're as rushed to do things," observes Paul
Pohlson, president of the Independent Insurance Agents of Iowa and
vice president of Ramsey Weeks in Grinnell.
"I look at other cities I travel to, and I just think we have
fewer accidents because people seem to slow down here. Maybe we
don't have as much road rage."
In small towns like Grinnell, where Pohlson works, "I'm probably
going to know the person that I hit or who hits me in an
People aren't quick to sue one another over car accidents in
Iowa, and the culture is fairly conservative, says Terry McDonald,
president-elect of the Independent Insurance Agents of Iowa and
executive vice president of A.W. Welt Ambrisco Insurance Inc. in
"It's not as easy to win over a jury as it can be in another
state," he says.
No. 51: Maine
"I do think Maine being so rural is a factor in low rates," says
Sheila Sawyer, president of the Maine Insurance Agents Association
and an agent with Carl M.P. Larrabee Agency Inc. in Wiscasset. "We
just don't have much city driving, and people learn to drive in all
types of weather."
Maine's tight restrictions on young drivers and
its graduated licensing program
for new drivers also likely help keep accidents (and rates) down,
Teens have to complete a state-approved driver education course
before they can apply for a learner's permit, and they go through a
three-step graduated licensing system which lets them get driving
experience under lower-risk conditions. A driver under 18 with an
"intermediate license," for instance, can't carry passengers other
than immediate family members or drive between midnight and 5
Insure.com commissioned Quadrant Information Services to provide
auto insurance rates for more than 750 car models from six large
carriers (Allstate, Farmers, GEICO, Nationwide, Progressive and
State Farm) in 10 ZIP codes per state. Rates were compiled in
We then averaged rates for all vehicles in each state to create
the rankings. Rates are for comparative purposes within the same
Rates are based on insurance for a single, 40-year-old male who
commutes 12 miles to work each day, with policy limits of
100/300/50 ($100,000 for injury liability for one person, $300,000
for all injuries and $50,000 for property damage in an accident)
and a $500 deductible on collision and comprehensive coverage. The
hypothetical driver has a clean record and good credit. The rate
includes uninsured motorist coverage. Actual rates will depend on
individual driver factors.