Car Insurance Rates by ZIP Code (2025)
Where you live influences car insurance rate factors like accident rates, population density, crime levels, and weather risks.
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ZIP codes matter for more than your mailing address. Car insurance companies use the nearly 42,000 U.S. ZIP codes to assess hyper-local data and predict drivers’ likelihood of filing claims.
Insurers see risk indicators — like population density, crash rates, crime levels, road conditions, and severe weather probability — as closely tied to location, so premium costs vary widely based on where you live. For example: Florida has the highest average liability insurance rates, but the five most expensive ZIP codes are in New York and Michigan, according to Insurify data.
Drivers in the least expensive areas of those states pay less, but no matter where you live, comparing car insurance can help lower your rates.
How ZIP code affects car insurance rates
ZIP codes are a key factor in setting car insurance rates. Companies can learn a lot about your risk level based on where you’re driving and parking your car. Risk factors can shift dramatically from town to town.
For example: Urban drivers pay higher auto insurance premiums than rural drivers due to increased rates of vandalism, theft, and accidents, according to the Insurance Information Institute. Weather is also a significant regional risk factor, and insurers consider the frequency and likelihood of severe storms or wildfires when setting rates for drivers in your area.
Risk factors that lead to higher car insurance rates
ZIP code data can tell insurers a lot about where you’re driving your vehicle and lead to higher auto insurance rates.
ZIP codes with the cheapest car insurance rates
Drivers in 54937 in Fond Du Lac, Wisconsin, have the cheapest car insurance rates. The area has a relatively low population density of 2,323 people per square mile and low-to-moderate climate risks. Car insurance rates in Wisconsin are well below the monthly national average, at $61 for liability-only coverage and $116 for full coverage.
Here are the 15 ZIP codes with the cheapest monthly auto insurance rates for liability and full-coverage car insurance.
ZIP codes with the highest car insurance rates
The ZIP code with the most expensive auto insurance rates is 11212 in Brooklyn, New York. New York City is one of the most densely populated areas in the country, with 29,303 people per square mile, and it has relatively high climate risks.
Brooklyn rates are higher than the state averages of $178 for liability-only coverage and $187 for full-coverage car insurance.
Here are the top 15 ZIP codes with the most expensive monthly car insurance rates.
Average car insurance rates in top cities
Raleigh, North Carolina, has the cheapest average car insurance rates, while Detroit, Michigan, has one of the most expensive averages.
Though Detroit and New York have similar rates, Detroit has fewer residents and a far lower population density. Detroit has a much lower median household income, too, which can lead to higher rates, as many insurers consider credit history and homeownership when setting rates.
This table shows the average monthly rate in the 50 most populous U.S. cities.
Where insurance rates are rising the fastest
Full-coverage car insurance premiums increased by 24% in 2023, as extreme weather, rising repair costs, and severe car accidents contributed to record losses for insurance companies, according to Insurify’s auto insurance report. Rates will increase by 7% in 2024, Insurify projects.
Five states experienced the biggest rate increases in 2023, according to Insurify data:
Illinois: +35%
Texas: +35%
North Carolina: +34%
Utah: +34%
South Carolina: +28%
Kevin Brasler, executive editor of Chicago Consumers’ Checkbook, a nonprofit consumer organization, told ABC 7 Chicago that the high cost of labor and auto parts and the increasing number of claims are leading to higher rates in Illinois.
Insurance fraud contributed to South Carolina’s high rates: The state ranks 13th in the nation for questionable vehicle-related insurance claims, according to the National Insurance Crime Bureau.
How to lower car insurance costs
Insurers use more information than ZIP codes to set rates, so here are some tips to lower your costs.
Be a safe driver
Keeping a clean driving record is the most effective way to get lower premiums. Wearing your seat belt and avoiding tailgating, speeding, and hard braking are all examples of safe driving habits.
Bundle multiple insurance policies
Bundling your auto insurance with homeowners or renters insurance can save you money if you have multiple policies with the same insurance company.
Work on improving your credit score
Actuarial data links credit history with the likelihood of filing claims, so having an excellent credit score can help secure lower rates.
Apply for discounts
Most car insurance companies offer savings options, from multi-vehicle discounts to good student discounts. These can add up to reduce costs significantly.
Compare car insurance quotes
Rates vary by insurance company as well as ZIP code, so shopping around will help you get the best car insurance and lowest rates.
ZIP code and car insurance FAQs
If you still have questions about car insurance rates by ZIP code, this additional information may help.
Is it legal for insurance companies to use ZIP code as a rating factor?
In most cases, yes. It’s legal in most states to use ZIP codes as a rating factor for auto insurance premiums. Where you live can determine risk levels based on population density, crime, and claims filed.
The states of Michigan and California don’t allow insurance companies to use ZIP codes for auto insurance rates.
Can you lie about your ZIP code to get a cheaper rate?
Your ZIP code is a factor that insurance companies use to assess levels of risk. Answering honestly is part of that. If you lie to your insurance company about your ZIP code to get a lower rate, insurers consider this insurance fraud. To avoid the consequences of insurance fraud, be forthright and honest with the details on your application, including your ZIP code.
Rural or urban areas: Which has cheaper car insurance?
Rural areas typically have cheaper car insurance because of a lower population density and reduced crime rate. Urban areas have a higher population density, which can lead to more accidents and crime, resulting in higher premiums.
What states have the cheapest car insurance rates?
Car insurance premiums fluctuate based on where you live. The states with the cheapest car insurance rates include Hawaii, Idaho, Ohio, Minnesota, and Wyoming, according to a recent Insurify report.
Which company has the cheapest car insurance rates?
Different companies offer the cheapest rates in different states and communities. But State Farm and USAA consistently rank among the cheapest national auto insurance companies.
You can find the most affordable insurers in your state with Insurify’s Car Insurance Rates by State.
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