The City of Detroit is home to the highest auto insurance rates in the country.
While Detroit’s recent emergence from bankruptcy may mean good news for its residents, some Detroiters are still facing a difficulty others do not: the most expensive car insurance in the nation.
In the city’s 48227 zip code, which is on the west side, the residents pay an average of $5,109 annually, a 130% increase over state average of $2,226, according to CarInsurance.com.
The result isn’t necessarily a surprise as this area is well-known for being terribly pricey for auto insurance.
A study last year showed there are vast differences in pricing even when the geographic difference is small. For example, the difference between the zip codes 48240 to 48227 is $2,365 (106%). The areas are less than five miles apart: one is in Detroit (48227) while the other is in Redford Township (48240), a small suburb that borders Detroit. The territorial rating system used by many insurance companies allows for anomalies like that.
(Single claim can bump up insurance costs 76%. For more, Click Here.)
The rest of the top 10 most expensive cities include:
- Brooklyn, N.Y. (11226): $3,877
- Philadelphia (19132): $2,760
- Providence, R.I. (02903): $2,749
- New Orleans (70117): $2,542
- Los Angeles (90029): $2,416
- Woodbridge, Conn. (06525): $2,291
- Baltimore (21216): $2,256
- Miami, Fla. (33142): $2,248
- Royalton, Ky. (41464): $2,104
Car insurance companies use a variety of factors when determining rates, and location is at the top of the list, the website notes. Insurers take into account the frequency of thefts, collisions and vandalism to gauge the likelihood of such incidents happening to drivers within the zip code.
(Click Here for details about how low- and moderate-income families are penalized by insurance companies.)
At the other end of the spectrum is Green Springs, Ohio, and zip code 44836 where insurance costs just $647, which is 16% lower than the state average of $771. Green Springs is a rural area in the north area of the state.
(To see more about millennials and they’re desire to drive, Click Here.)
The other cheap cities include:
- Arden, N.C. (28704): $671
- Saco, Maine (04072): $709
- Christiansburg, Va. (24073): $751
- Boise, Idaho (83706): $753
- Lake Havasu City, Ariz. (86403): $769
- West Lafayette, Ind. (47907): $770
- Allouez, Wis. (54302): $776
- Concord, N.H. (03303): $785
- Normal, Ill. (61761): $827
The fact is that there is no justification what so ever for the absurd rates nor the variations in rates. Obviously metropolitan areas can be subject to more auto thefts than small towns, the fact is there are also more insured vehicles so the loss ratio is not necessarily higher and the revenue is significantly greater so the absurd rates simply are exploitation.
As previously noted the city, sate and federal government agencies entrusted with protecting consumers from this type of abuse have failed the people. Those individuals responsible for enforcing the laws and preventing this thievery, can be bought with PAC money and so the crime continues even when exposed by many in the media. The insurance lobbyists are very good at painting an untrue picture of there unscrupulous acts which they believe are totally justified. Take a look at their ivory towers, executive compensation and annual profits, then do the math.
The sheeple complain about obamacare but none complain about being forced to pay for overpriced auto insurance. Surprisingly, the insurance industry wrote the law and the jerk offs in Lansing don’t even provide any oversight on this legalized crime cabal. I understand that people in Detroit pay up to $1000 per month for auto insurance. This is nothing but legalized crime and any politician that takes any money from these criminals needs to be forced to use obamacare.
Last year several ambulances were stolen during emergency runs and the Secret Service lost a vehicle to theft while VP Biden was visiting Detroit. I hardly think it’s the insurance companies who are criminal.