Insurance is not cheaper in rural areas contrary to the popular belief that it is, as drivers in many rural areas actually pay more for car insurance than a lot of city dwellers. In fact, seven of the states with the highest car insurance premiums in the nation are among the most rural.
Arkansas, Mississippi, West Virginia, Oklahoma, Montana, Kentucky and Wyoming have some of the higher car insurance rates and they are among the most rural. Some highly urbanized states, including New Jersey and Massachusetts have fairly reasonable car insurance costs. The reason for this is that there a lot of different factors that affect the cost of car insurance. Some of these factors have little or nothing to do with the kind of area people live in.
Why Rural Residents Pay More
There are several different reasons why car insurance is not cheaper in rural areas of the U.S. Many rural residents drive more. In some areas of the country you have to drive 50 to 100 miles just to reach the grocery store. More time on the road increases chances of getting in an accident, which raises insurance rates.
Rural residents also have less access to alternatives to driving such as public transportation or car pools, which increases driving. A lot of companies base rates on the mileage driven.
Rural residents are more likely to drive on dangerous roads such as winding mountain highways and in dangerous conditions such as after dark or in ice and snow. That can also increase the risk of accidents and premiums.
Some rural states have wonky legal systems that increase the amount paid out in accident claims. That increases the cost of insurance because insurance companies have to pay out more. This appears to be the case in Southern states like Arkansas and Mississippi.
There are also more uninsured motorists on the road in rural areas that have a higher rate of poverty. Poor people in rural areas have to drive because there’s no public transit. That increases premiums for responsible drivers, who buy insurance.
However, some rural states, including Maine and Iowa have fairly low insurance premiums. These states have laws that limit insurance payouts and stricter traffic laws. Some small towns in Ohio also have very low insurance rates.
Accident rates and thefts are not the biggest factor that raise the price of car insurance. Statistics indicate that state laws are the biggest factor affecting the price of auto insurance: Louisiana and Michigan have the highest premiums in the nation because of state laws. Residents of small towns in those states pay more than drivers in big cities like Los Angeles and Denver.
Arkansas, Mississippi, West Virginia, Oklahoma, Montana, Kentucky and Wyoming have some of the higher car insurance rates and they are among the most rural. Some highly urbanized states, including New Jersey and Massachusetts have fairly reasonable car insurance costs. The reason for this is that there a lot of different factors that affect the cost of car insurance. Some of these factors have little or nothing to do with the kind of area people live in.
Why Rural Residents Pay More
There are several different reasons why car insurance is not cheaper in rural areas of the U.S. Many rural residents drive more. In some areas of the country you have to drive 50 to 100 miles just to reach the grocery store. More time on the road increases chances of getting in an accident, which raises insurance rates.
Rural residents also have less access to alternatives to driving such as public transportation or car pools, which increases driving. A lot of companies base rates on the mileage driven.
Rural residents are more likely to drive on dangerous roads such as winding mountain highways and in dangerous conditions such as after dark or in ice and snow. That can also increase the risk of accidents and premiums.
Some rural states have wonky legal systems that increase the amount paid out in accident claims. That increases the cost of insurance because insurance companies have to pay out more. This appears to be the case in Southern states like Arkansas and Mississippi.
There are also more uninsured motorists on the road in rural areas that have a higher rate of poverty. Poor people in rural areas have to drive because there’s no public transit. That increases premiums for responsible drivers, who buy insurance.
However, some rural states, including Maine and Iowa have fairly low insurance premiums. These states have laws that limit insurance payouts and stricter traffic laws. Some small towns in Ohio also have very low insurance rates.
Accident rates and thefts are not the biggest factor that raise the price of car insurance. Statistics indicate that state laws are the biggest factor affecting the price of auto insurance: Louisiana and Michigan have the highest premiums in the nation because of state laws. Residents of small towns in those states pay more than drivers in big cities like Los Angeles and Denver.
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