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Soaring interest rates and record high transaction prices are now being accompanied by rising insurance costs.

According to a new study from Bankrate, the national average price for full coverage auto insurance has jumped from $1,771 in 2022 to $2,014 in 2023.  That’s an increase of 13.72% and it means the average household is now spending 2.93% of their income on car insurance.

That being said, these numbers vary by region and Florida prices are downright astronomical.  Miami was the most expensive market with an average annual premium of $3,447 and it was closely followed by Tampa at $3,302.  Both metropolitan areas are spending more than 5% of their annual household income on car insurance.

Most Expensive Metro Areas For Car Insurance

Metro Area Average Premium % of Household Income Spent
Miami $3,447 5.51%
Tampa $3,302 5.25%
Detroit $3,067 4.77%
Orlando $3,078 4.55%
Los Angeles $2,641 3.33%

Orlando wasn’t far behind at $3,078.  However, looking past the sunshine state, Detroiters are paying an average of $3,067.  Likewise, drivers in Los Angeles are shelling out an average of $2,641.

On the flip side, the cheapest metro area was Boston at $1,328.  Other cities with affordable insurance include Seattle ($1,361), Portland ($1,458), Charlotte ($1,484), and Washington, D.C. ($1,711).

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Bankrate’s Cate Deventer explained, “Full coverage car insurance premiums rose an average of 13.72% between 2022 and 2023, due in part to inflation, supply chain disruptions, and labor shortages. These factors all individually increase the cost of claims, and when combined, drove up the cost to repair or replace vehicles significantly.”  This results in higher insurance rates overall, but because each “geographic area has different risks … the cost for car insurance varies across the nation.”

Costs Of Life Events

Life Event Added Average Cost Added Cost In Most Expensive Metro Area
Credit Score Drops From Good To Poor $1,465 Detroit: $4,989
Get A Speeding Ticket $413 Los Angeles: $1,018
Involved In Accident $840 Los Angeles: $1,652
Lapse In Coverage $199 Tampa: $1,154
Convicted Of DUI $1,887 Detroit: $4,035
Teen Driver Added To Policy $2,378 Miami: $3,754

While that’s the base scenario, so-called “life events” can cause insurance rates to increase dramatically.  The biggest is adding a teen driver to your policy as the study found it increases your insurance by an average of $2,378.  That’s a 14.27% jump from 2022 and it brings the overall cost to an average of $4,392.

When it comes to bad behavior behind the wheel, a DUI is the worst offender as it will cost you an extra $1,887 on average.  However, that skyrockets to a whopping $4,035 in metro Detroit.

Getting involved in an accident increases the cost of insurance by an average of $840, which is more than twice the increase of getting a speeding ticket ($413).  However, both were dwarfed by a drop in your credit rating as seeing your score go from good to poor will cost you an extra $1,465 on average.  In Detroit, it’s a devastating blow of $4,989.

As with anything else, it pays to shop around to get the best deal.  If your rates have increased and you’ve stayed with your current provider for awhile, you might want to check out the competition and see what you can get.

State Avg Annual Premium Change vs. 2022
Alabama $1,843 $83
Alaska $1,946 $260
Arizona $1,810 $67
Arkansas $1,907 $101
California $2,291 $101
Colorado $2,121 $102
Connecticut $1,553 $20
Delaware $2,103 $140
Florida $3,183 $421
Georgia $2,085 $100
Hawaii $1,275 $69
Idaho $1,133 $68
Illinois $1,806 $258
Indiana $1,295 $53
Iowa $1,315 $61
Kansas $1,878 $76
Kentucky $2,124 $170
Louisiana $2,909 $45
Maine $941 $65
Maryland $1,971 $40
Massachusetts $1,262 $-34
Michigan $2,691 $346
Minnesota $1,760 $68
Mississippi $1,771 $70
Missouri $1,943 $82
Montana $1,889 $94
Nebraska $1,624 $86
Nevada $2,779 $353
New Hampshire $1,262 $80
New Jersey $1,754 $-137
New Mexico $1,591 $102
New York $3,139 $143
North Carolina $1,446 $54
North Dakota $1,302 $77
Ohio $1,266 $66
Oklahoma $1,998 $96
Oregon $1,415 $44
Pennsylvania $2,040 $38
Rhode Island $1,886 $39
South Carolina $1,532 $68
South Dakota $1,553 $11
Tennessee $1,429 $46
Texas $2,019 $151
Utah $1,510 $61
Vermont $1,061 $61
Virginia $1,439 $99
Washington $1,410 $97
West Virginia $1,580 $53
Wisconsin $1,292 $43
Wyoming $1,582 $72