Car insurance prices have been on the rise, and people in one particular state are being hit hardest.
If you’re living in Louisiana and think you’re paying a lot, you’re probably right. According to data published this month from Bankrate, car insurance in Louisiana is ranked as the highest “true cost” in the U.S.
Bankrate said that the average annual premium for car insurance in Louisiana is $3,618, equal to more tan 6.5% of household income in the state. Florida and Michigan also had high true cost rankings, but both accounted for under 6% of household income.
Nationally, the average U.S. driver spends 3.41% of their income on a full coverage car insurance policy. That comes out to about $212 per month, while those with minimum coverage pay $62 per month.
Survey results released this week by the Motley Fool indicate “two-thirds of respondents cited premium costs as one of two most important auto insurance factors when shopping and 60% cited coverage options.”
To determine the true cost of car insurance by state, Bankrate analyzed what percentage of household income is spent on an annual full coverage car insurance policy and then ranked each state by true cost. Overall, the analysis found that coverage across car insurance coverage throughout the country rose 26% this year over last year to $2,543. J.D. Power also found last summer that “nearly one-third (31%) of U.S. auto insurance customers say they experienced a rate increase during the past year as the industry raises rates an average of 15.5%.”
“Louisiana drivers have the highest true cost rank of 50,” said Bankrate. Both Louisiana and Florida experience extreme weather, which leads to frequent catastrophic claims.
On the other side of the spectrum, drivers in Massachusetts have the lowest true cost rank of 1. There, they spend just 1.76% of their income on car insurance. People in Hawaii also spend just 1.79% of their income on car insurance.