Drivers may be paying too much for auto insurance coverage

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Survey suggests that drivers are paying more than they should for insurance coverage

Many drivers in the United States may be paying too much for auto insurance coverage, according to a survey from NerdWallet. The survey drew information from 1,000 zip codes throughout the country, including the average rates that insurance companies charge for covering drivers and their vehicles. The survey found that, on average, prices in auto insurance coverage varied by 154% based on zip code. NerdWallet suggests that those shopping around for coverage could find significant savings.

Drivers could save 32% on their insurance coverage if they shop around

The survey suggests that drivers could save an average of 32% of their insurance costs if they shop around. This translates into an average of $368 in savings every year, depending on where the driver lives. The survey found that auto insurance rates are highest in Texas, where the maximum insurance premium was found to be $3,133. New York is home to the highest median premium, coming in at $1,661.

State law and fraud can affect the cost of auto insurance coverage

auto insurance car hydrogen There are many factors that affect the cost of auto insurance coverage. In some states, coverage is more expensive because of the existence of no-fault laws. These laws require insurance companies to cover damage done to a vehicle, as well as medical costs of those involved, regardless of who is at fault in an accident. In other states, fraud is a significant problem that leads to major losses for insurance companies. In order to recover from these losses, insurers often raise rates on the coverage that they provide.

Consumers could save money by communicating with their insurance providers directly

The survey suggests that those that do not shop around could be overpaying for auto insurance coverage. Consumers can also call their insurer directly or work with an insurance agent to see if there is a way to lower rates. Some insurance companies offer usage-based policies, which are only paid for if they are actually being used by the driver. This is still a rare insurance product and not all insurers offer such policies.

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