How Your Address Affects Your Car Insurance Premiums

Why You Can Trust Compare.com

At Compare.com, it’s our mission to find simple ways to help our customers save money on the things they need. While we partner with some of the companies and brands we talk about in our articles, all of our content is written and reviewed by our independent editorial team and never influenced by our partnerships. Learn about how we make money, review our editorial standards, and reference our data methodology to learn more about why you can trust Compare.com.

Written by Nick Versaw

Updated August 3, 2022

Did you know that where you live affects your car insurance premiums? That’s because auto insurance companies set your premium based on the risk they take on to insure you. Where you drive and park your vehicle at night directly contributes to that risk factor. 

Let’s explore how your address affects your car insurance premiums.

How Does Changing Your Address Affect Your Car Insurance?

When you change your address, your car insurance premiums may change. That’s because insurance companies use your home address as a way to measure your level of risk. 

Here’s a closer look at some of the factors directly tied to the place you call home. 

Local Traffic

Where you live gives car insurance companies an idea of what your commute looks like. If you live in an area known for heavy traffic or frequent accidents (perhaps there’s a particularly dangerous intersection just a few blocks from your house), then your car insurance rates could be higher than someone who lives in an area where there is very little traffic.

Insurance companies periodically look at the number of accidents reported by police in your area as well. If data shows an increase or decrease in reported accidents, your car insurance premiums may change to reflect this.

Crime Rates

Crime in your neighborhood also plays a role in how much you pay in car insurance premiums. Again, your address is used to get crime reports from local police forces so the insurance company can assess the risk based on your zip code. If there are higher-than-average rates of vehicle break-ins, theft or vandalism in your area, you could be paying more than someone who lives somewhere with lower rates. 

You can see a full report on the top stolen cars in the United States on the National Insurance Crime Bureau’s (NICB) website.

Parking options

Where you park your car at night matters to insurance providers. Generally, addresses associated with street parking will pay more than homes with a private driveway.

Also, those with a garage are likely to pay even less. Having your vehicle If you safely tucked away inside of a garage at night lowers your chances of a break-in or theft. So, insurance companies reward drivers that have a safe space to store their vehicles with lower auto insurance rates. 

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

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

In some cases, you’ll slo 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 a good time to make sure you are getting the best rate on car insurance. When you scope out the options, you might score a better deal to avoid overpaying. 

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 fluctuates as well

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

Do You Have to Change Your Car Insurance When You Move Out of State?

When you move to a different state, you’ll need to lock in a new car insurance policy reflecting your current address. As a new resident of a state, you are legally required to make the switch because 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 certain timeframe. In most states, you’ll have between 30 to 90 days to switch your car insurance coverage over when making a move. 

If you aren’t sure what the timeline is 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. 

Does Changing Your Address Affect Car Insurance Rates?

If you are planning on moving to a new state, you’ll want to explore the impact the new address will have on your current car insurance policy. Registering and insuring a car in your new home state is not only required by the law, but it’s also an opportune time to make sure you’re getting the best rate possible for the coverage you need

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

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

1. Know the Deadlines: Before moving, it’s critical that you find out how much time 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’re going to need to at least update the insurance policy.
2. 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 car 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! Make sure to check in with your old state to see how you’re required to dispose of old license plates. Some will require you mail them in while other states allow you to recycle them or take another course of action.
3. Shop Around: When you know what type of coverage you are looking for, it’s time to start comparison shopping. A quick look at all of your options will help you find the best rate in a matter of minutes. If you need help, Compare has you covered! Explore the best options in just a few minutes to check this item off of your to-do list. 
4. Ask for a Discount: You can find a wide range of discounts available through auto insurers. A few potential discounts include multi-car, pay in full, vehicle safety, anti-theft, good driving, and accident-free discounts. If you think you qualify for a discount, don’t be afraid to ask the insurance provider. Remember the worst they can say is no. 
5. Purchase a New Policy: You’ve done your homework, so rest assured that your comparison shopping and research has yielded you 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 that you’re not paying for 2 premiums at the same time.
6. Cancel Your Old Car Insurance Policy: And feel good about moving on. Keep in mind that many companies will prorate any remaining balance during this process.

Car insurance companies are all about assessing risk. 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 offer you a better rate.

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. 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. We can help you streamline the comparison shopping process. 

Nick Versaw Managing Editor

Nick Versaw leads Compare.com's editorial department, where he and his team specialize in creating educational content about insurance and other related topics. As an award-winning writer, Nick has seen his work published in countless renowned publications, such as the Washington Post, Los Angeles Times, and U.S. News & World Report. He graduated with Latin honors from Virginia Commonwealth University, where he earned his Bachelor's Degree in Digital Journalism.