Auto insurance

Revealed – Most and Least Expensive US States for Car Insurance

  • Louisiana (3.01%)
  • Florida (2.42%)
  • Michigan (2.33%)

Meanwhile, the states with the most affordable car insurance by the same metric are:

  • Hawaii (0.95%)
  • New Hampshire (0.99%)
  • North Dakota (1.00%)

It has been noted that there is a 3:1 disparity in affordability between Louisiana and Hawaii.

The study also focused on the key cost drivers that make up insurance pricing. These costs include accident frequency; repair costs; relative frequency of injury claims; medical use; intervention of a lawyer; claim abuse; uninsured motorists; and the litigation climate.

The IRC noted that in the 1990s car insurance expenditures averaged 1.93% of household income. It fell to 1.70% in the 2000s and then to 1.60% in the 2010s. Citing research from the Insurance Information Institute (Triple-I), the onset of the pandemic in 2020, as well as the frequency and the increasing severity of automobile accidents in 2021 and 2022, “have significantly changed the automobile insurance market since the end of 2019,” observed the IRC.

“Insurance Research Council research shows affordability of personal auto insurance is improving, with spending as a percentage of median household income declining steadily between the 1990s and 2010s in the United States and falling to 1 .56% in 2019, the latest year for which data is available,” said IRC Chairman and Director of Triple-I Insurance Dale Porfilio, FCAS, MAAA. “However, our study indicated that there is a 3:1 disparity in affordability between the least affordable and most affordable state.”

“Our report seeks to illuminate these differences with a comprehensive state-by-state analysis that can help guide policymakers in their efforts to improve the overall affordability of auto insurance in their market,” the president added.

Read more: Revealed – the most and least expensive states for car insurance in 2022

The results of the IRC study align with those carried out a few months ago by the financial services company Bankrate. This report also found that drivers in Louisiana spend the largest proportion of their money on auto insurance, followed by Florida.