Insurance rates are all about where you live
Americans spend trillions of dollars on insurance to protect them against accidents and financial risks. According to NerdWallet, the average American spends about 12 percent of their annual income on life, auto, health, and homeowner’s insurance. What’s interesting is that your insurance costs vary based on where you live.
Take car insurance, for example. In Texas, the average annual cost is $1,063. In Michigan, it’s $3,096. This is because Michigan has unlimited lifetime medical coverage for those injured in an auto accident. However, Michiganders only pay around $802 annually for homeowners, while Texans’ bills run about double that, $1661/year. Someone has to pay for the wind and tornado damage.
State legislation has an impact on your premiums
The key findings from the NerdWallet study indicate that four of the five most expensive states for combined insurance costs were in the Northeast, New York, New Jersey, Massachusetts, Rhode Island, and Vermont. The lowest combined total for insurance costs was Utah, coming in at $3,942 annually. However, Maryland residents have the lowest ratio of insurance to income at 7.7 percent.
Louisiana has the highest ratio, spending 18.1 percent of their annual income on insurance. State legislation has an effect on your premiums, as the department of insurance for your state has certain requirements that are mandated by law.
Because you probably can’t move anytime soon just to get better insurance rates, what does this mean to you?
First, you can use the findings in the survey to find out if your insurance costs are in line with the state’s average.
Next, whether your insurance rates are average or too high, you can shop around for insurance. Work with an agent to find lower premiums to cover your risks. Ask your agent about discounts for installing safety features on your home or car. Talk about lowering your deductible, if you have the savings so that it doesn’t make a bad situation worse.
Pay attention to what you’re paying for insurance. It pays to shop around.