A new study has revealed a major difference in premiums and Alabama drivers continue to pay more.
Quadrant Information Services and insuranceQuotes.com have jointly released an auto insurance rates study. Within it, they named Alabama as the fourth most expensive state for drivers to be insured.
The research examined some of the factors that play a role in making this coverage more expensive.
What was found was that Alabama drivers pay more in auto insurance rates because of state regulations. Insurance companies in the state are permitted to use driving distance as a factor in calculating premiums. Therefore, the more a motorist drives, the more he or she will need to pay for coverage. This was among the conclusions presented by Quadrant Information Services and insuranceQuotes.com within the report on their study.
They stated that drivers who travel more than 15,000 miles per year pay higher auto insurance rates.
The research determined that this appeared to be a key threshold in many states across the country. In fact, nationwide, drivers who are on the road for more than 15,000 miles per year pay an average of 9 percent more than those who drive less. In Alabama, motorists see a slightly higher increase when they’re on the road longer. The average Alabama driver who clocks over 15,000 miles per year will pay 10 percent more for coverage.
_________________________Random Quotes to Remember ~ "Don't be distracted by criticism. Remember--the only taste of success some people get is to take a bite out of you." -- Zig Ziglar
This type of calculation does not apply in every state. Not all states permit auto insurance companies to take that factor into consideration. Alabama drivers pay slightly more for car insurance when they drive more because of the state’s unique regulations. According to R Street Institute president, Eli Lehrer, state insurance regulators apply different rules to this matter, leading to considerable differences in the amount that drivers end up paying. The R Street Institute is a Washington D.C.-based public policy research organization.
“In most states, mileage just isn’t that big a factor since insurers, on the whole, don’t love using it because it’s difficult to track,” said Lehrer. He also pointed out that California and North Carolina are on opposite ends of the spectrum from each other as their regulators play a substantial role in the way rates and insurance premiums are calculated.
In North Carolina, auto insurance rates aren’t affected by mileage. In California, on the other hand, drivers travelling over 15,000 miles per year pay a whopping 26 percent more on their premiums.