How where you live changes your car insurance price

What "location" means on a quote

When you ask for a quote, the insurer wants the address where the car is usually parked overnight, often called the garaging address. That is usually your home, but not always: a car kept at a second home or at college may be garaged somewhere else. The Texas Department of Insurance (TDI) says it plainly: rates are based on where a car is usually located. Its consumer guide adds that rates are higher if you live in a city and can also vary between ZIP codes in the same city.

Location reflects risks a single driver can't control: how much traffic there is, how often cars are stolen, what hail, floods and storms do, and what repairs and medical care cost in the area. Each insurer decides how to price areas in its own filed rating plan, which is one reason two companies can quote the same address very differently.

How big the differences are

The National Association of Insurance Commissioners (NAIC) publishes what insurers collected per insured car in every state. Its 2023 figures, the latest by state, show how far apart states sit before anything about you is priced in.

The lines of the bill don't move together. Comprehensive pays for damage that isn't a collision, such as hail, flooding and theft, and it swings widely from state to state. In 2023 it averaged $473 in South Dakota, $447 in Colorado and $400 in Texas, against $238 nationally and $117 in Hawaii. Florida's high total came mostly from liability, which at $1,294 was the largest liability figure in the 2023 table.

Where you live also changes who you are likely to share the road with. The Insurance Research Council estimated that 15.4% of U.S. drivers were uninsured in 2023, but the share ran from 5.7% in Maine to 28.2% in Mississippi. The higher it is where you drive, the more often an at-fault driver may have no insurance to pay for your injuries, and the more uninsured motorist coverage is worth to you. Our page on limits and deductibles shows how to size it.

Where states limit location pricing

Rates are filed with each state's insurance regulator, and location is a common part of those filings. A few rules narrow how it can be used:

• Michigan. The 2019 auto insurance reform lists ZIP codes among the non-driving factors, along with sex, marital status, home ownership, credit score, education and occupation, that insurers can't use in setting a driver's rates, according to the state's Department of Insurance and Financial Services.
• Credit-based insurance scores. Some states keep your address out of the credit side of pricing. In Arizona (A.R.S. § 20-2110), Colorado (C.R.S. § 10-4-116) and Georgia (O.C.G.A. § 33-24-91), an insurance score can't be built from your address or ZIP code; New Jersey's scoring rules also exclude address.

These rules limit specific uses; they don't make prices the same everywhere in a state. Your state page names the regulator that reviews rate filings and takes complaints. Our page on credit-based insurance scores covers the other credit limits.

When you move, or keep the car somewhere else

A move can raise or lower your premium even when nothing else changes, because rates are based on where the car is usually kept. Moving to another state goes further: the policy has to meet that state's required coverages, which can differ a lot. Texas requires 30/60/25 liability and attaches personal injury protection unless you reject it in writing, while Michigan policies are no-fault and default to 250/500 bodily injury limits. You will also need to register the car in the new state, and the policy should be in place before the old one ends.

• Tell your insurer before or right after you move. The price is set for the address on the policy.
• Give the address where the car really sleeps. If the policy lists an address where the car isn't kept, the price rests on wrong information, and that can cause problems with a claim or the policy. Ask your insurer how it handles a car kept at another address.
• Tell the insurer about a student away at school. TDI advises telling your insurance company if you have a child living in another city for school. Ask, too, how a car kept at a second home is handled.

What you can do about a location-driven price

1. 1 Re-shop after a move. Your current insurer's prices for the new area may not be competitive; get quotes on the same limits and deductibles from two or three companies.
2. 2 Look hard at comprehensive if you live where hail, floods or theft drive it up. A higher comprehensive deductible lowers that line; test it with the deductible break-even calculator.
3. 3 Ask about anti-theft and safety discounts. Maine's Bureau of Insurance, for one, lists anti-theft devices among the discounts insurers commonly offer; see vehicle safety and anti-theft discounts.
4. 4 Check the other lines of the bill. Location is fixed once you live somewhere; your record, your car, your mileage and your coverage choices are not.

Questions drivers ask