These Are the States Where Auto Insurance Costs Less

CarData Consultants recently ranked the 50 states according to which ones have the lowest average auto insurance premiums. The results aren’t all that surprising.

While insurance rates have been steadily rising across the country, states with lower premiums do still exist.

The 10 states that feature the lowest premium rates are listed below, starting with Iowa as the state holding the lowest premiums in the country. CarData Consultants reviews in detail the 5 states that bottom out this list. (Prices quoted assume a traffic record of 1 speeding ticket, a not-at-fault collision and 100/300/100 coverage including business use insurance).

Here are the rankings:

  1. Iowa
  2. North Carolina
  3. Ohio
  4. New Hampshire
  5. Maine
  6. Idaho
  7. Wisconsin
  8. Kansas
  9. North Dakota
  10. Arizona

In the position for the lowest premiums nationwide comes the state of Iowa, with insurance premium averages of $1125.

Iowans enjoy these low rates partly due to the lack of large urban areas.  Iowa doesn’t have a compulsory insurance law – instead the state’s Financial and Safety Responsibility Act requires that if you cause injury or property damage to others you have the financial means to cover the incident.

North Carolina comes in at number 2 with premiums averaging $1316*. North Carolina has not had an application for a rate increase since 2009.

If you opt for the cheapest liability car insurance in North Carolina, you are only covered for damage you do to other drivers’ cars and for others’ injuries. That means your insurer won’t pay for damage to your car or for your injuries if you cause an accident.

Competition Really Helps Keep Rates Low

Ohio has the third lowest rates in the nation with averages around $1370. The reason is somewhat surprising, it is due to competition. There are five times the insurance carriers in Ohio than in California, and those 650 carriers keep rates low.

Compare that number to the approximately 134 in California and just over 40 in New Jersey, you can see how competition has positively affected rates.

New Hampshire premiums average $1379. NH is one of the most unique states for car insurance, It doesn’t require drivers to carry car insurance, just that drivers have the ability to pay for damages following an accident. The Granite state has cheap car insurance rates, and you’ll need insurance if you plan on driving in other states.

Maine ranks number 5 with an average of $1401.  Maine is a sweet spot of favorable factors, there are few large urban areas so traffic problems are limited and accident rates are low, and in spite of snow the state does not get major weather incidents like tornados and hailstorms.

And there is a very low 4% uninsured motorist rate. In Maine drivers take their responsibilities seriously.

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