Where you live affects your car insurance rate 100%. It can either increase the premium you are required to pay or decrease the amount you must pay. Your “garaging address” definitely makes a huge difference in car insurance premiums and rates.
As a licensed insurance representative, my clients often ask me about the impact of their living area on their insurance rates. In this article, we’ll discuss how the area you live in affects your insurance rates, so you can make more informed decisions about your coverage, and potentially save money.
Table of contents
Zip Code And Insurance Rates
A person’s zip code can affect their car insurance rates, as insurance companies may consider factors such as the number and severity of accidents and theft in a specific area when setting rates.
For example, areas with a higher rate of accidents or theft may be seen as higher risk and result in higher premiums. On the other hand, areas with a lower rate of accidents and theft may be considered lower risk and result in lower premiums.
Where you live and park your vehicle makes a huge difference in insurance rates.
Pro Tip: The impact of a zip code on insurance premiums can vary depending on the insurance company and the specific policy.
It’s a good idea to consider the insurance rates in your area when shopping for car insurance and to compare quotes from multiple insurers to find the best rates.
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State And Insurance Rates
As a licensed car insurance broker, the question I get asked frequently is: Why is my premium in (fill in a state) higher than my friends’ in (fill in another state)?
Well, a big factor in determining your premium is what state you live in, because each state’s insurance regulations and laws, as well as the cost of living and state of the economy, can impact insurance premiums.
Car insurance could be higher in your state for various reasons, ranging from higher accident rates and liability limits to pricier vehicles.
On the flip side, you might score a better rate because you live in a state with quieter roads, less fender benders, and because people’s liability rates are lower there.
Consider the insurance rates in your state when shopping for car insurance and to compare quotes from multiple insurers to find the best rates.
Urban vs. Rural Areas
Throughout my years as an insurance agent, I’m frequently asked how insurance rates change between urban and rural areas.
Well, insurance companies consider factors such as traffic, the risk of getting in an accident, and even public transportation systems when determining rates.
In reality, urban areas are all hustle and bustle–meaning you may take on higher premiums by living there. For example, urban areas with heavy traffic and a higher risk of accidents may be seen as higher risk and result in higher premiums. On the other hand, rural areas with less traffic and a lower risk of accidents may be considered lower risk and result in lower premiums.
Pro Tip: The impact of a person’s location on insurance premiums can vary depending on the insurance company and the specific policy.
Military Base And Insurance Rates
Throughout my career as a licensed insurance broker, I found that insurance companies often offer military personnel a special rate due to factors related to their service.
For example, they may consider whether they live on a military base (and its location), or if they’re stationed overseas when determining their rates. It is important to ask your broker about discounts or special coverage options if you’re serving in the armed forces to make sure you get the best rate possible!
Conclusion
Although insurance companies consider multiple factors when determining their premiums, where you live is a significant consideration. Factors such as a person’s zip code, state of residence, urban vs. rural locations, or serving in the armed forces all impact your insurance rates.
Ask your insurance company about discounts or special coverage options based on your location so you can make informed decisions about your coverage and potentially save money.
