Do you think you know the most expensive cities for auto insurance? Despite the belief most people have that they are paying too much for the car insurance coverage they have, statistically speaking, consumers in some cities are actually paying a lot more than you are.
Which are these most expensive cities for auto insurance? We’ve got them here for you, based on an analysis of the most and least expensive cities for auto insurance as published recently on Yahoo.com.
Top Five Most Expensive Cities for Auto Insurance
1. Detroit, Michigan – Yes, it is the Motor City, but that doesn’t mean anything good when it comes to how much car insurance premiums cost. In fact, Detroit is the numero uno city on the list of the most expensive cities for auto insurance. How expensive? The average annual premium is a whopping $5,941. So now, your own car insurance bill doesn’t look so bad, right? Reasons for this high cost include it being an urban area with a high crime rate, an unemployment rate of nearly 15 percent, the highest in the nation, and a “too generous” no-fault auto insurance system offering unlimited care to injured persons, regardless of fault.
2. Philadelphia, Pennsylvania – The City of Brotherly Love, Philadelphia, Pennsylvania is anything but kind when it comes to the cost of annual auto insurance premiums. At number two on the list of most expensive cities for auto insurance, the average annual premium in Philadelphia runs $4,076. Reasons cited include the fact that Philly is an urban area with high traffic density. City dwellers have come to expect higher rates, and this is a fact mentioned by J.D. Power and Associates in an article on how to save money on insurance premiums. The city of Philadelphia also has a high number of uninsured drivers, which tends to run up the premiums for insured drivers to cover the liability. Personal injury costs are also higher in Philadelphia than other cities.
3. New Orleans, Louisiana – With an average annual auto insurance premium of $3,599, New Orleans, Louisiana arrives at the number three spot of most expensive cities for auto insurance because of its court system. How’s that? In the state of Louisiana, the only cases that go to jury trial are those with claims in excess of $50,000 – meaning most cases are settled for $49,000. That drives up the insurance premiums for everyone. Add to that the fact that there are higher bodily injury rates and more lawsuits per capita than other states and it’s no wonder New Orleans (another urban area) has such high cost auto insurance.
4. Miami, Florida – Why is Miami, Florida number four on the list of most expensive cities for auto insurance? According to the National Insurance Crime Bureau (NICB), port cities tend to be high-theft areas, and Miami is an international port. Other reasons for the average annual auto insurance premium in Miami of $3,388 are its high rate of uninsured drivers, the fact that it is the most populous Southeastern city, which leads to more traffic congestion and more accidents, and a no-fault system of auto insurance that leads to more fraudulent claims and higher premiums for car insurance overall.
5. Newark, New Jersey – With an annual average insurance premium of $2,867, Newark, New Jersey claims the number five spot on the list of most expensive cities for auto insurance. Factors affecting the cost of premiums include the fact that the city has more lawyers per capita than any other state. That and the fact that defense costs in New Jersey were 16 percent of auto insurance premiums, compared with just seven percent nationwide.