Floridians on average pay the second highest share of their income in auto insurance premiums, according to a tally of data from the price comparison website Bankrate.com.
The tally, based on the website’s annual report on the true cost of auto insurance in 2022, compared what 40-year-old drivers with good driving records and good credit pay in all 50 U.S. states and at Washington DC.
In Florida, the average driver spends 4.42% of their income on car insurance. That’s behind only Louisiana, where drivers must spend 5.26% of their income.
In a dollar-for-dollar comparison, Florida drivers pay an average of $2,762 a year for what Bankrate describes as comprehensive coverage. The most expensive state was New York, where the same driver pays $2,996 per year. Louisiana was number three at $2,864. Drivers in Maine, the cheapest state, paid an average of $876.
Florida’s average cost was nearly $400 higher than Bankrate’s 2021 report average of $2,364. It also far exceeds the national average of $1,771 or 2.57% of annual income.
Auto insurance costs in busy, litigious and congested South Florida are still higher than the state average, according to Bankrate’s report. In the metro area made up of Broward, Palm Beach and Miami-Dade counties, the average premium was $3,508.
Rates were calculated assuming each customer drives a 2020 Toyota Camry, commutes five days a week, and travels 12,000 miles per year.
The study also assumed that each driver wore full coverage. This is defined as follows: $100,000 bodily injury liability per person, $300,000 bodily injury liability per accident, $50,000 property damage liability per accident, $100,000 bodily injury one uninsured motorist per person, $300,000 for uninsured motorist bodily injury per accident, $500 collision deductible and $500 full deductible.
The state has historically come out on top in auto insurance price comparisons, regardless of which organization produces the comparison. In 2018, price comparison site The Zebra found Florida to be the fifth most expensive state. A decade earlier, Florida’s average premium for liability coverage was the second highest in the nation, according to the Property Casualty Insurers Association of America.
Reasons Florida drivers pay so much include the state’s sensitivity to inclement weather such as tropical storms, hurricanes and tornadoes, Bankrate.com’s Cate Deventer wrote in a blog post in April. Deventer also pointed to the high percentage of uninsured drivers in the state – 20.4%. This means that one in five vehicles on the road are driven by insurance fraud, increasing the costs of coverage for uninsured motorists.
Mark Friedlander, director of corporate communications for the industry-funded Institute for Insurance Information, also pointed to high levels of medical billing fraud related to stage accidents and insurance laws without insurance. state fault, as well as a provision of state law requiring insurers to replace damaged or cracked windshields without a deductible.
“Entrepreneurs approach motorists at malls, gas stations and car washes and offer to take care of replacing their damaged windshield in exchange for a gift card,” he said. . “The motorist is required to sign an AOB (assignment of benefits)”, which gives the contractor the right to sue an insurer on behalf of the insured.
“Simple repairs are sometimes billed thousands of dollars to insurers,” he said. “Many claims involve litigation brought against the insurer when the vehicle owner is not even aware that a lawsuit has been filed.”
Nationwide auto insurance rates have risen after temporarily plummeting when the COVID-19 pandemic forced people to stay home. Miles driven and accidents fell sharply, and the auto insurance industry returned about $14 billion in cash refunds and account credits, Friedlander said.
But motorists quickly returned to their old driving habits after the economy reopened, and road fatalities also rose after decades of steady decline, he said.
Auto-related fatalities in Florida rose from 3,332 in 2020 to 3,629 in 2021, according to the Florida Division of Highway Safety and Motor Vehicles. That’s a nearly 10% rise that also increases insurance costs and premiums, Friedlander said.
Inflation also contributes to higher fares. “What we’re seeing now are double-digit year-over-year increases in repair costs, driven by supply chain spare parts shortages and labor costs. higher work,” he said.
The rates are even higher than South Florida state averages due to several factors, Friedlander said:
• More accidents and more seriousness
• More expensive car repairs due to higher labor costs
• Higher level of vehicle crimes, such as theft and vandalism
• Heavier traffic patterns
• Higher healthcare costs
• More aggressive driving
What to do
Although drivers cannot change these cost factors on their own, they can keep their own costs as low as possible by avoiding “life events” that can lead to significant rate increases, the study points out. Bankrate.com.
Letting your credit score go from “good” to “bad” can raise average auto insurance premiums in Florida by $2,715, the study found.
Costs can also increase if you: get a speeding ticket (+$514); cause a car accident (+$1,046); let your insurance coverage expire (+$448); be convicted of impaired driving (+$1,695) or have a teen driver listed on your policy (+$3,043).
Beyond avoiding such occurrences, experts suggest a number of ways motorists can try to lower their premiums. If you drive less than the average vehicle owner, you might consider policies that allow you to pay per kilometer. These typically require allowing insurers to monitor your driving through smartphone apps that connect to your odometer to record miles driven.
Further savings are available by buying and paying online, paying your term all at once and buying in advance.