Louisiana Residents Suffer Most From Surging Car Insurance Costs

According to The Center Square, car insurance costs have increased by 26% in the last year and are anticipated to rise further until 2025.

This is according to the True Cost of Auto Insurance study from Bankrate, an independent comparison service.

The article utilizes the most recent median income data from the United States Census Bureau to calculate the percentage of income spent on vehicle insurance in 2024.

The article utilizes the most recent median income data from the United States Census Bureau to calculate the percentage of income spent on vehicle insurance in 2024. Previously, it relied on average income data. Bankrate began utilizing median income data in 2024 because it was more reflective “of what people earn in a given geographic area.”

The average yearly rate for full coverage auto insurance in 2024 countrywide is $2,543, according to the research, up from $2,014 in 2023 and $1,771 in 2022. For a person with a median household income of $74,580, vehicle insurance costs 3.41% of their salary.

Missouri has the highest percentage rise in the average annual cost of full coverage vehicle insurance, at 44%. Rates rose from $1,943 in 2023 to $2,801 in 2024, the highest rise among all 50 states.

Floridians pay the highest average cost for full coverage automobile insurance, $3,945 per year, a $762 rise over the previous year.

According to the survey, Louisiana drivers spend the most on vehicle insurance, accounting for 6.53% of their income. Florida ranked second with 5.69%. Arkansas ranked third, at 3.95%.

In comparison, Massachusetts drivers pay the lowest proportion of their income for vehicle insurance – 1.76%.

When comparing vehicle insurance rates in 25 major metropolitan regions, the survey discovered that “drivers in Detroit pay the highest net average cost of car insurance and the highest true cost of car insurance, with a staggering 7.98 percent of income spent on auto coverage.”

In 2024, Detroit drivers will pay an average yearly premium actual cost of $5,687.

Three Florida towns ranked among the top five after Detroit: Miami ($4,213), Tampa ($4,078), and Orlando ($3,631).

St. Louis ranked fourth-worst ($3,352), completing the top five most expensive metropolitan areas.

Californians in Los Angeles, Riverside-San Bernardino, San Diego, and San Francisco pay the highest average annual rates in the two most populated states and 25 metro areas evaluated. Texans living in Houston, San Antonio, and Dallas pay the highest.

“Auto insurance rates have been rising at a breakneck pace,” said Greg McBride, chief financial analyst at Bankrate. “And, while the rate of increase will eventually moderate, this does not guarantee premiums will decrease. The insurance market is quite competitive, with several advertising, so look about and compare coverage to see if you can find a better bargain elsewhere. If you have a healthy cash cushion, consider increasing your deductible to lower your costs.

According to the report, a policyholder’s rate is influenced by a variety of factors beyond their control, such as increased car accidents and driving habits in their zip code, medical bills related to car accidents, increased costs for parts and labor, state-mandated car insurance requirements, population density, and so on.

“Inflation and extreme weather, which are both significant influencers for rates in 2024, are also beyond your control,” according to the research.

According to the survey, drivers can positively affect their premium by using criteria such as driving history, car type, and credit history.

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