According to an Insure.com Quadrant Information Services study, Michigan has now taken the place held by Louisiana last year, when it had the most expensive auto insurance premiums in the country.
The average rate paid by Michigan drivers for their auto insurance is $2,541, while Louisiana’s average rate is $2,453 per year.
The study data was used to determine the cheapest and most expensive insurance rates among the states. Amy Danise, the senior managing editor at Insure.com stated that this is the study’s second year, and that the website has every intention of performing the research on an annual basis.
Danise explained, using the results of the study, that auto insurance premiums in Louisiana are higher than other states due to a law that doesn’t permit claims lower than $50,000 to have a jury trial. Instead, claims for less than that amount are heard by an elected judge.
Danise said that Louisiana car insurance agents have identified the judicial system as the cause of the high insurance premiums being paid by drivers within that state. She explained that the state is a “lawsuit-happy” one, and as a result of that, only an elected judge will hear claims under $50,000, and that these judges tend to “side with the little guy instead of insurance companies.”
The result is often expensive settlements which is placing people with good driving records and a well maintained vehicle at the court system’s mercy.
That said, insurance company owner and Mayor of Opelousas, Don Cravins Sr., disagreed that the only or primary cause of the high insurance rates in Louisiana are the laws in the state. He said that there were many other contributing factors such as the legal and medical professions, insurance companies, road quality problems in the state, the number of people who drive uninsured, and the number of fraudulent claims.