December 11, 2018

What is the Average Price of Car Insurance?

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According to a December 2009 report from the National Association of Insurance Commissioners (NAIC), the average auto insurance premium paid in the United States in 2007 was $795. The average price paid for a Liability policy was $475, Collision coverage prices averaged $301 and Comprehensive policies averaged $136. These premiums are based on data from 2007 which means that the cost of coverage could have fluctuated in the meantime.

One must keep in mind that this is only the nationwide average and will not reflect what an individual will pay for coverage. Individuals should complete a quote comparison to help determine what their insurance costs will be. The amount that particular motorists pay is based on many factors which may cause their premiums to be above or below the national average. Such factors include; driver’s history, age, gender, place of residence, type of coverage and the year, make and model of vehicles to be insured.

Areas with the Highest and Lowest Average Price of Auto Insurance

Motorists should be aware that the average cost of coverage in certain areas are affected by many factors aside from the insured driver. Factors such as population, traffic congestion, crime rate will have an impact on the rates being paid due to higher risk of a loss and the more claims that are usually paid out by insurers as a result; this will cause providers to raise rates to compensate for previous losses.

In addition, areas with healthy economies will usually average high premium costs due to the fact that there may be a higher number of newer vehicles which will make it more likely that these automobiles will be covered by Comprehensive and Collision, thus raising premium averages.

Below is a list of the areas with the highest cost of coverage followed by the average premium in 2007 according to the National Association of Insurance Commissioners;

  1. District of Columbia – $1,140
  2. New Jersey – $1,104
  3. Louisiana – $1,096
  4. New York – $1,047
  5. Florida – $1,043
  6. Rhode Island – $1,017
  7. Delaware – $1,012
  8. Nevada – $1,000
  9. Massachusetts – $981
  10. Connecticut – $964

It is important to understand that these figures will not determine what an individual is going to pay for a policy; a major reason that some of the states are listed above is due to the fact that they contain cities which averaged high premiums, but may also contain rural areas where premiums can be relatively cheap.

For example, the following states ranked among the lowest in the nation due to the fact that they are mainly rural areas with much less traffic density and a lower number of claims and losses;

  1. North Dakota – $512
  2. Iowa – $518
  3. South Dakota – $534
  4. Nebraska – $554
  5. Idaho – $564
  6. Kansas – $568
  7. Wisconsin – $582
  8. North Carolina – $591
  9. Maine – $611
  10. Indiana – $618

The amounts mentioned above are not intended to indicate how much a motorist will pay for coverage. The best way for individuals to find out what the cost of an auto insurance premium will be is to obtain quotes and shop around due to the various factors used by insurers to determine rates.