How Your Address Affects Your Car Insurance Premiums

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Does where you live affect car insurance: man driving a car

Outside of demographic factors, one of the main ways auto insurance companies determine the cost of your premiums is your ZIP code. Do not expect residents of sparsely populated Boise, Idaho, to pay the same rates as high-population areas like New York City, thanks to the varying volume of thefts, at-fault accidents, uninsured drivers, property damage, and insurance claims frequency in every region.

This guide will help answer all of your questions about how where you live affects car insurance, including stats about rural, suburban, and urban areas; the most expensive and least expensive states for auto insurance; and ways you can save on your policy.

If you are paying too high a premium based on where you live, now is an excellent time to request quotes from multiple auto insurance providers using’s rate comparison tool.

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How Does Where You Live Affect Car Insurance Rates?

Does where you live affect car insurance: woman using her phone

For starters, not all ZIP codes are created equal, as theft, vandalism, natural disaster, and similar variables vary by region, with premiums adjusted to compensate.

According to the Insurance Information Institute (III), auto insurance companies use a ZIP code-based rating system to determine premiums, grouping different geographical areas based on accident, theft, and vandalism rates.

Another way where you live affects car insurance rates is reflected through the lens of urban, suburban, and rural areas. According to Quadrant data, the average monthly premium for a full coverage policy is $473 for urban drivers, $376 for suburban drivers, and $311 for rural drivers.

Consider your ZIP code one of the key factors in determining your insurance premiums. Remember, other factors such as age, gender, and driving record apply. Does where you live affect car insurance? Absolutely, but it is not the end all be all.

Which Regions Pay the Highest Auto Insurance Rates?

According to the Insurance Information Institute, the most expensive states for auto insurance as a percentage of median household income in 2018 were Louisiana (3.09%), Florida (2.61%), Michigan (2.43%), Mississippi (2.27%), and Georgia (2.17%).

In turn, the five states paying the lowest auto insurance rates (relative to household income) include Vermont (1.11%), Hawaii (1.04%), New Hampshire (1.04%), North Dakota (1.03%), and Iowa (1.02%).

Do You Have to Change Your Car Insurance When You Move?

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When you move, you’ll need to update your car insurance policy.

In some cases, you’ll have to change your car insurance company when you move. If your current insurer doesn’t work in the area around your new home, then you’ll have no choice but to switch providers.

Even if you aren’t required to make a switch, moving is an excellent time to ensure you get the best car insurance rate. Then, when you scope out the options, you might score a better deal to avoid overpaying.

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How is Your Car Insurance Impacted When You Move Out of State?

Every state has different car insurance requirements with various state minimum liability coverage requirements. Some even require Personal Injury Protection (PIP) coverage. Since the amount of coverage you must carry varies based on the state you live in, the amount you will pay also fluctuates.

For example, your new state might require less liability coverage. In that case, you could save on your premiums due to the lower coverage amount.

Do You Have to Change Your Car Insurance When You Move?

When you move to a different state, you must update your auto insurance policy to reflect your new address. As a new state resident, you’re legally required to switch since every state has different coverage requirements.

You can’t put this to-do at the bottom of your list, either. Instead, you’ll likely need to switch over the coverage within a specific timeframe. For example, in most states, you’ll have between 30 to 90 days to switch your car insurance coverage when moving.

If you aren’t sure about the timeline for your new state, check out the information posted by your local Department of Motor Vehicles. Or call up your insurance company to see how they can help you have a smooth transition.

How to Find the Best Car Insurance When Moving Out of State

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Follow this checklist when moving somewhere new to make sure your insurer is compliant and that you find the best deal possible:

Know the Deadlines

Before moving, find out how long you can legally drive in your new state before registering and insuring your car. The timeline is usually about 30 days, but you’ll want to check with the local Department of Motor Vehicles. Even if the move is temporary, you will still need to update your insurance policy.

Register Your Vehicle

Some states require that you already have your new insurance policy established before registering your car in a new state. That said, some insurance companies may require your vehicle to be registered in the new state. You’ll need to register your vehicle and get new license plates — by stopping in a DMV or managing the process online — within the designated time frame discussed above. 

One more thing: Check with your old state to see how you’re required to dispose of old license plates. Some will require you to mail them in, while other states allow you to recycle them or take another course of action.

Shop Around

When you know what type of coverage you want, it’s time to start comparison shopping. A quick look at your options will help you find the best rate in minutes. If you need help, has you covered! Explore the best options using our comparison tool to check this item off your to-do list.

Compare All Your New Insurance Options

Ask for a Discount

You can find a wide range of discounts available through auto insurers. Potential discounts include multi-policy, pay-in-full, automatic payments, vehicle safety, anti-theft, good driving, and car accident-free discounts. If you qualify for a discount, don’t hesitate to ask the insurance provider. The worst they can say is no.

Purchase a New Policy

You’ve done your homework, so rest assured that your comparison shopping and research have yielded the most competitively priced car insurance policy. Now it’s important to establish a new policy before canceling your current auto insurance plan. Usually, you can make the transition seamlessly, so you’re not paying for two premiums simultaneously.

Cancel Your Old Car Insurance Policy

And feel good about moving on. Remember that many companies will prorate any remaining balance during this process.

Car insurance companies are all about assessing risk for all policyholders. The best way for you to lower your car insurance premium is to shop around and see what each company has to offer. Different car insurance companies may not assign the same level of risk to your neighborhood as others and could provide you with a better rate.

Maintain a Clean Driving Record

Drivers with a clean driving record pay an average monthly liability-only premium of $123 versus $160 (one speeding ticket), $179 (one accident), and $251 for DUI-convicted drivers. It simply pays to drive clean!

Are You Moving? It’s Time to Check Your Quotes

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Now that you know how geography affects auto insurance premiums, a recent move may make today an excellent time to shop for car insurance quotes from affordable providers like State Farm, Liberty Mutual, Nationwide, and Progressive.

Requesting a free quote through takes less than two minutes:

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Frequently Asked Questions

Why does it matter what address you use for car insurance?

The address you use for car insurance matters because insurance companies use your home location when determining your rates. Therefore, depending on your address, you might find higher or lower premiums based on the risk factors on the roads surrounding your home.

What happens if you move and don’t change your car insurance?

If you don’t change your car insurance address after a move, that choice can constitute a break of your insurance policy. At that point, the insurance company might refuse to pay for claims filed after your move.

The good news is you usually have several weeks to sort out the details of your car insurance after a move. Since a move can get busy, set a reminder on your calendar to tackle this important task.

How to get a better car insurance rate when you move?

The best way to find a better rate is to compare car insurance rates from different companies.

It might not always be possible to lower your rate depending on where you’re moving, but what you can guarantee is that you’re not overpaying for your insurance. In addition, we can help you streamline the comparison shopping process.

Methodology: All of the data referenced in this article has been gathered in collaboration with Quadrant Information Services. We analyzed more than 2.5 million rows of carrier-reported data to calculate the average rates referenced above. All rates are based on an insurance profile of a single-vehicle policy for a Honda Accord driver. For more information on how we calculate rates, please reference our data methodology.

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