Where You Live Impacts Your Car Insurance Rate

Yahoo Autos posted an article by Justin Hyde on February 5th of this year listing the top ten cities in the U.S. with the highest car insurance rates.  One of the two points raised by Justin is that car insurance rates are impacted by where you live more than by how you drive.

Justin’s point does beg the question, does where you live impact what you pay for your car insurance?  Absolutely!  As you can see, the list of the top ten cities ranked by average annual car insurance rates, shows a wide difference in what people pay:

  • Detroit, MI at $10,723.22
  • New Orleans, LA at $4,309.61
  • Grand Rapids, MI at $4,042.42
  • Newark, NJ at $3,525.43
  • Baton Rouge, LA at $3,363.73
  • Hialeah, FL at $3,271.86
  • Jersey City, NJ at $3,266.63
  • Louisville, KY $3,255.99
  • Miami, FL at $3,168.75
  • Philadelphia, PA at $2,930.53

Houston was the highest ranked Texas city which came in at an average annual rate of $2,211.62 placing it at number 28 on the list.  The Dallas / Fort Worth area, as well as, Austin and San Antonio ranked outside the top 30 cities.

Nerd Wallet (www.nerdwallet.com), which created the list of most expensive cities for car insurance, also listed the top ten lowest cities for car insurance.  Making that list were:

  • Winston-Salem, NC at $969.10
  • Greensboro, NC at $1,089.58
  • Raliegh, NC at $1,098.48
  • Durham, NC at $1,100.50
  • Charlotte, NC at $1,123.09
  • Boise, ID at $1,221.65
  • Rochester, NY at $1,249.26
  • Fayetteville, NC at $1,294.80
  • Spokane, WA at $1,307.68
  • Montgomery, AL at $1,375.82

There are a number of items that impact what each of us pays for car insurance including, credit, vehicle type, commuting distance, driving record, and even where you live.  Looking at north Texas average rates, Dallas and Fort Worth drivers pay roughly the same average annual rate, all things being equal.  Residents of Collin County pay slightly lower average annual rates followed by Denton County.  Residents of Rockwall, Wise, Parker, and Johnson Counties pay rates slightly lower than residents of Denton County.

One of the reasons for the difference in rates across the counties is population density which translates into number of vehicles on the roads and number of accidents.  If recent growth trends continue for the Dallas / Fort Worth area as they have for the last decade, then rates in Denton and Collin Counties should become equal with Dallas and Tarrant Counties.  Rates in Wise, Parker, Johnson, and Rockwall Counties should also increase.

There are also insurance rate differences between people living in the same county but in different zip codes.  Factors influencing this include crime (vehicle theft), weather related claim patterns (hail impacts more than our roofs), and location related accident claims.  These differences ultimately point to varying levels of risk and the insurance companies do charge different rates based on risk level factors.

I wouldn’t advise anyone to move in order to snag a lower car insurance rate, the difference would not be worth it.  I do know though that if you want to pay less for your car insurance, then improve your credit, keep a clean driving record (tickets and accidents), and be willing to compare rates every two years.

What do you think?  Share your comments, questions, and suggestions with us in the comments section of our blog or on our Google + and Facebook pages!  I’d love to hear from you!

Evie Wise
Evie Wise


Evie Wise
Evie Wise

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