Average Cost of Car Insurance in Kentucky

Kentucky operates as a "choice no-fault" state, meaning drivers can opt out of personal injury protection coverage by filing a rejection form with the Kentucky Department of Insurance. By default, all Kentucky drivers have PIP coverage that pays up to $10,000 per person for medical expenses, lost wages, and related costs regardless of who caused the accident. However, drivers can reject PIP coverage to potentially save money, though this also removes the lawsuit protections that come with no-fault coverage.

Kentucky has one of the highest rates of uninsured drivers in the nation, with a substantial percentage of drivers operating without insurance. This means roughly one in seven drivers on Kentucky roads lacks proper insurance coverage, much higher than states with effective enforcement mechanisms. The high number of uninsured motorists makes optional uninsured motorist coverage particularly valuable for Kentucky drivers, as it provides financial protection when hit by someone without insurance.

Since 2020, FEMA has issued disaster declarations for Kentucky, with the state experiencing a relentless string of billion-dollar weather disasters including tornadoes, floods, and ice storms. Wind and hail have the most impact on insurance claims in Kentucky, with the last two years seeing an unprecedented number of catastrophic weather events. The higher instances of extreme weather in Kentucky, like tornadoes, contribute to variations in policy pricing as insurers face increased claim payouts.

Auto repairs in Kentucky are getting more expensive due to added technology and features in modern cars, contributing to higher insurance premiums. The cost of providing insurance continues to rise both in Kentucky and nationwide, with all insured drivers sharing the increasing cost through higher premiums at renewal time. Insurance companies are losing money due to the frequency of catastrophic events, making it difficult to keep rates stable.

Motor vehicle theft occurs frequently in Kentucky, with the Kentucky State Police reporting increases in recent years. Louisville, Kentucky's largest city, has higher car theft rates, with the busy streets becoming even more crowded when out-of-state visitors arrive for attractions like Churchill Downs. Higher population density in Louisville leads to heavier traffic and more claims, while theft and vandalism occur more often in large cities than rural areas.

Kentucky has a state-sponsored auto insurance plan for high-risk drivers who may find it difficult to get coverage on the voluntary market. If you have trouble getting insured through the voluntary market, you can get coverage via the Kentucky Automobile Insurance Plan, provided you meet eligibility requirements including proof that you attempted and couldn't get insurance in the last 60 days. Drivers who've been denied car insurance on the voluntary market due to a checkered driving record or other factors can seek coverage through the Kentucky Automobile Insurance Plan.