The Most Expensive US States for Car Insurance 2024

Jul 4, 2024

Jo Plumridge

The most expensive states for car insurance - featured. A pair of glasses, pen, car keys and calculator lie on top of a few page contract

Car insurance rates can vary dramatically from state to state. Is yours one of the most expensive? We’ll find out in this guide

You may not be aware of this but, with the ever-rising costs of car ownership, which state you live in can have one of the biggest impacts on the price of your car insurance. For example, Louisiana is now the most expensive state for car insurance, with premiums costing almost $1,000 a year more than the national average.

But why is this? And what factors are coming into play? In this guide, we’ll look at the most expensive states for car insurance (not including any separate extended car warranties you may have), along with our tips on cutting the costs of premiums.

Which is the most expensive state for car insurance?

The national average for full coverage car insurance is $1,895 but, as you’ll see from our table below, some states pay considerably more. These are the top ten most expensive states for car insurance as of June 2024.

State	2023 rates	2022 rates	% increase 2022-23
Louisiana	$2,883	$2,535	14%
Florida	$2,694	$2,583	4%
California	$2,416	$2,110	15%
Colorado	$2,337	$1,807	29%
South Dakota	$2,280	$1,553	47%
Michigan	$2,266	$2,158	5%
Kentucky	$2,228	$1,869	19%
Montana	$2,193	$1,751	25%
Washington, D.C	$2,157	$1,845	17%

What state-specific factors impact car insurance costs?

As we’ve noted, where you live makes a huge difference to your premiums, and these are some of the state-specific factors that can drive up the cost of your insurance.

1. Car insurance laws

The minimum requirements for car insurance vary from state to state. Some only require liability car insurance, while others insist on full coverage along with medical payments and uninsured motorist coverage.

These 12 no-fault states require personal injury protection:

Florida
Kentucky
Minnesota
North Dakota
Hawaii
Massachusetts
New Jersey
Pennsylvania
Kansas
Michigan
New York
Utah

Some state requirements include minimum coverage limits that can raise or lower your car premiums. However, it’s generally recommended to take out more coverage than required by law, as these mandatory limits aren’t always enough to cover the entire cost of an accident.

Some states have banned using gender to determine the price of car insurance, declaring the practice to be discriminatory, including:

California
Hawaii
Massachusetts
Michigan
Montana
North Carolina
Pennsylvania

These states ban the use of credit ratings when pricing insurance:

California
Hawaii
Massachusetts
Michigan

And two states don’t have mandatory car insurance at all. In New Hampshire, you are only required to provide proof of your financial capacity to cover the cost of injuries and damages should you cause an accident. In Virginia, drivers can voluntarily opt out of coverage, as long as they can show signs of financial responsibility, though they must also pay a $500 uninsured motor vehicle fee.

2. Crime rates

Insurance companies will use a client’s address to evaluate the risks of crime in their area, often by gathering information from local police reports. The cost of car insurance will be higher in high-crime areas, with theft and vandalism raising premiums. And this is not just as a result of being a victim of crime – insurers base their prices on the collective risk, so if you live in an area that’s been deemed high risk, you’ll pay the higher prices whether you’ve been a victim or not.

3. Geographic location

States with expensive car insurance rates are often those with a higher occurrence of extreme weather conditions. If your state is prone to flooding, hurricanes, or other natural disasters, your premiums will be raised to account for that added risk. And some insurers won’t even offer coverage in these states, leaving the smaller pool of insurers with a good excuse to raise their prices even higher.

4. Uninsured drivers

Insurance companies don’t want to bear the cost if you’re hit by an uninsured driver. So, to negate any hit to their bottom line, they’ll raise your premiums if your state has a higher percentage of uninsured drivers.

These states have the highest percentage of uninsured drivers:

Mississippi – 29.4%
Michigan – 25.5%
Tennessee – 23.7%
New Mexico – 21.8%
Washington – 21.7%
Florida – 20.4%
Alabama – 19.5%
Arkansas – 19.3%
District of Columbia – 19.1%
California – 16.6%

5. Urban areas

City roads have more motorists, which means more vehicles on the road, which means more accidents and collisions. Of course, this leads to a higher risk of being involved in an accident, which means that insurance premiums get raised.

What other factors affect your car insurance rates?

Outside of location, there are other factors that car insurance companies consider when setting your insurance rate, though these are personal, rather than state-specific.

1. Driving record

As you might expect, the worst drivers have to pay more for insurance. If you have a history of fines, accidents, or speeding, you should expect your premiums to soar. A clean driving record shows insurers that you’re less of a risk and you’ll be rewarded with lower premiums.

2. Age and gender

Younger drivers have the highest premiums as they’re seen as the riskiest age group to insure. Young men, in particular, are seen as a risk but women under 25 will also pay more than older, more experienced drivers. Drivers under 20 are considered the highest risk, with teens more likely to be drunk driving, speeding, not using seat belts, and being distracted while driving.

Younger women will often pay less than men, but by the time both genders reach 25, they are usually on equal footing. However, as mentioned above, some states have banned considering gender when setting premiums.

3. Vehicle type

Drive a car with high safety ratings and you’ll be seen as less likely to incur heavy medical bills after an accident. Unsurprisingly, you’ll also pay less for driving a compact than a Ferrari! Newer cars also cost less to insure, as they are less likely to break down or get into accidents due to mechanical failure.

4. Marital status

Statistically, married couples make fewer claims than single drivers, and this means lower car insurance premiums. Couples may also be eligible for multi-car policies, which will also offer lower prices. The downside is that if your partner has a poor driving record, your premiums could go up.

5. Credit score

Unless you live in a state where taking a person’s credit rating into account is banned, insurance companies will also look at this to determine how much of a risk you’ll be to insure. Missed payments on other products will raise your insurance premiums.

6. Location

We’ve talked about location on a state level, but personal circumstances may play a role too. Apart from crime rates, where you park your car can affect your premiums – your rate will be lower if you park in a garage, or at least off-road.

How can you save money on your car insurance if you live in an expensive state?

Aside from the slightly drastic step of moving state, there are a few things you can do to lower your premiums:

The most expensive states for car insurance. A green piggy bank sitting inside car above the steering wheel

Avoid auto-renew – When your policy is due for renewal is the best time to shop around for better options, so don’t just let your car insurance auto-renew.

Pay premiums yearly – If you can, it’s worth paying your premium in one lump sum to avoid interest or finance arrangement fees.

Shop around – It can be a bit tedious but it’s worth comparing quotes from at least three different insurers to find a good price.

Look for discounts – Car insurers will offer discounts for a variety of reasons, such as choosing an eco-friendly vehicle, practicing safe driving, or limiting your mileage.

Think about your vehicle choices – If you’re looking for a new car, consider whether it’s expensive to insure. Newer and smaller cars usually cost less, as do family-friendly vehicles.

Keep a clean driving license – Insurance companies will offer discounts and lower premiums to those with a spotless license.

Raise your deductible – This is an easy way to save money but will mean the amount you have to pay before your coverage kicks in is increased. So, it’s important you only do this if you have enough set aside to cover the gap.

Think before you claim – Every time you make a claim it will have an impact on your rates when you renew. It’s worth considering whether to claim or pay for the damages yourself, particularly if it’s at the lower end of the scale.