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Car insurance is cheaper in rural areas because the roads are less congested which lowers the rate of collisions and poses less risk for insurance companies. Lower rates of theft and vandalism also significantly reduce car insurance premiums in rural areas.
Rural and urban drivers face different risks on the road which most insurance companies use to determine your insurance premiums. If you are looking to buy car insurance, understanding the specific risks that are common in your areas can help you get the best rates.
Cost of Insurance in Rural Areas
Different states have different insurance rates, however, some areas have higher average premiums compared to others. For instance, according to Insurance Business America, Detroit, MI has the highest average annual premiums at $6,329.
Michigan has a no-fault car insurance policy theme that accommodates unlimited personal injury protection. Compared to other states, Michigan also has higher crime rates which drive up car insurance premiums significantly.
The cheapest states for car insurance are Lafayette, Indiana, and Wapakoneta, Ohio. Candler, North Carolina also has cheap premiums because the area has a thriving auto insurance market.
While state laws are among the key factors that determine your insurance rates, only 16 states enforce this policy and many of those are ranked among the most expensive places to insure your car. Heavily urbanized states have considerably higher premiums than smaller cities with fewer metropolitan areas.
Other factors that affect the cost of insurance in rural areas are weather, traffic, economic status, and competing insurance companies.
Why Rural Areas Have Lower Premiums but Higher Violations
On average urban drivers pay more in insurance, however, rural drivers have more traffic violations. Interestingly, more traffic violations usually mean higher car insurance premiums in urban areas but this rule does not apply in rural areas.
Drivers in urban settings are likely to get pulled over for missing a turn, illegal turns, a suspended license, or running a red light. On the other hand, rural drivers are more likely to get on the road with defective equipment.
Ultimately, urban drivers pay more because their violations are higher risk. A traffic violation in an urban setting is more dangerous because the roads are more congested and put more people at risk. Compared to rural settings, where there are fewer drivers and less people at risk.
Other Factors That Influence the Cost of Insurance in Rural Areas
There are other factors that influence the rate of insurance in rural areas. In addition to the risk of a driver causing an accident, insurance companies also consider these factors to determine insurance rates.
Statistical data shows that areas with higher populations often have higher rates of car collisions. For insurance companies, this is a significant risk and they shield themselves by charging more in premiums. Other factors that contribute to this risk include:
Theft Rates
More vehicles are stolen in urban cities with several metropolitan areas and more especially in states nearing national borders. These vehicles are then used in crimes such as drug trafficking. This risk leads to higher premiums.
Increased Traffic
Congested roads, poor visibility in parking spaces, and rush hour traffic are just a few contributors to collisions in urban settings compared to rural areas where there is less traffic congestion.
People living in urban areas are also more likely to be sleepy or tired at the wheel because of the daily commute in heavy traffic. This drives up their car insurance premiums significantly.
Vandalism
Rural areas report fewer cases of vehicle vandalism compared to urban areas. If you are planning on moving to a city with high crime rates such as Bakersfield, CA prepare to pay higher premiums on your car insurance.
How To Reduce Your Car Premiums
While rural drivers might pay lower insurance premiums, it is estimated that most collisions in these areas are likely to be fatal. This is because of the increased likelihood of single-car collisions, drunk driving, and the time it takes for emergency services to arrive at the scene.
However, there are still some methods you can use to lower your car insurance premiums no matter where you live.
● Installing an anti-theft device to keep your vehicle safe
● Using public transport or carpooling to reduce your driving
● Parking in a garage to reduce the risk of vandalism
● Taking a defensive driving course
● Avoid drinking and driving
● Obey all traffic signs to avoid tickets and other traffic violations
● Buy an affordable car with good safety ratings
Summary
The above driving habits reduce the chances of a collision and can significantly reduce your car insurance premiums.
If you are in the market for a new insurance provider, be sure to compare different companies and find out which ones offer discounts such as multi-policy discounts. Some insurance companies also offer safe-driving discounts.
