A Guest Post today from my friend Crystal –
No-fault states often require that people purchase much more auto insurance than tort states, so it’s not a surprise that nine of the ten cities with the most expensive auto insurance rates are in two no-fault states. The following 10 cities have higher auto insurance rates than any others in the country:
• Detroit, Michigan ($4,599)
• Highland Park, Michigan ($4,214)
• Brooklyn, New York ($4,133)
• Fort Hamilton, New York ($3,947)
• Grosse Pointe Park, Michigan ($3,504)
• Bronx, New York ($3,443)
• Allison, Texas ($3,385)
• St. Albans, New York ($3,233)
• Springfield Gardens, New York ($3,213)
According to autoinsurancequotes.com in no-fault states, it doesn’t matter who caused the collision. The at-fault person will not be required to pay the medical bills of everyone who was hurt. The insurance company that insures the vehicle in which the injured parties were riding will be required to pay the medical bills up to the limits of the PIP insurance policy.
Required Insurance Coverage in Michigan
Along with Personal Injury Protection (PIP) insurance that pays everyone’s medical bills, Michigan residents must purchase Property Protection insurance in the amount of $1 million. Even though Michigan is a no-fault state, drivers are still required to purchase bodily injury and property damage liability insurance coverage. Generally, people are only required to purchase bodily injury and property damage liability insurance coverage in other states. Therefore, the greater amount of coverage and the higher limits will naturally increase the prices for people living in Michigan.
Required Insurance Coverage in New York
New York is also a no-fault state, and a greater amount of insurance coverage is required of drivers here as well. Motorists must have a certain amount of bodily injury and property damage liability coverage, but they are also required to have PIP insurance as well as uninsured and underinsured motorist bodily injury coverage.
Higher Rates for Everyone
In the cities mentioned above, even people in the most desired demographic who have the greatest driving records will be quoted auto insurance rates that are higher than they would receive in other cities. The reason is that insurance companies base their quotes on the zip code in which their customers live. For example, insurance companies perform research on different cities in which they sell insurance, and they often discover that more claims for auto insurance coverage come from customers from a particular zip code. Because this is the case, anyone who is driving in this zip code has a greater chance of filing a claim with the insurance company, and these drivers will be assessed higher rates.
Auto insurance companies set rates based on more than just the number of claims filed. The number of accidents and thefts and vandalism rates also play a role. Cities with a high risk for most or all of these factors are going to be the ones that have the highest auto insurance rates. Auto insurance companies charge clients who are less likely to need to use their insurance coverage lower rates, and those who live in high risk areas in no-fault states don’t fit this description.
How is your car insurance bill? Anything close to these top-ten cities?