Why Is Car Insurance So Expensive in Florida?
Florida's auto insurance rates are high for several reasons, including the state's no-fault auto insurance laws, risk exposure due to extreme weather conditions, average driver profile, and the number of uninsured drivers.
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The average cost of car insurance in Florida is $2,208 per year, making it the fourth-highest compared to other states. Alabama and Georgia, which share a border with Florida, have lower rates — drivers in Georgia pay $1,638 on average, while policies in Alabama cost $1,221 annually.
Several factors contribute to why car insurance rates are so high in Florida. These include environmental factors, such as traffic density and weather risks, and driver profiles. If you live in this state, you have to be proactive in comparing car insurance quotes because Florida auto insurance rates are so expensive.
As of 2021, drivers in Florida paid an annual average of $2,208 for car insurance. Auto insurance rates in Florida saw a 25% increase from 2015 to 2021.
Several factors contribute to why car insurance in Florida is so expensive, including busy roadways, additional insurance requirements, high healthcare costs, rates of uninsured drivers and risk of severe weather.
Despite the high cost of car insurance in Florida, there are several ways to reduce your premium.
Why Florida Car Insurance Rates Are So High
If you’ve noticed that you spend more for coverage in recent years, you’re not alone. The average cost of car insurance has increased across the country, and auto insurance rates in Florida are following the same pattern. Significant factors contributing to this shift are the state’s busy roads, additional insurance requirements, high healthcare costs, high-risk drivers, uninsured drivers and severe weather risks.
Traffic and Busy Roadways
Research has shown that around 79.8 million people visited Florida in 2020. With ports, beaches and premier amusement parks, it’s no surprise that Florida is the third-busiest state in the country.
These visitors result in highways with higher traffic density, which increases auto insurance rates in Florida. From a carrier’s perspective, the closer people drive to other vehicles, the higher the likelihood of accidents.
Extra Insurance Requirements
Like most states, car insurance in Florida is required. To drive in the state, you must carry a policy meeting the state’s minimum liability requirements — property damage limits of at least $10,000 and personal injury protection (PIP) coverage of $10,000. PIP is an extra requirement because Florida is a no-fault state. This insurance covers your expenses in an accident, regardless of who’s at fault.
Expensive Healthcare Costs
When you’re involved in an accident, insurance providers use the premiums paid by consumers to help pay for your expenses. The costs covered include medical expenses from injuries sustained by the drivers and their passengers or — in tort states — treatments needed by the other party.
The United States spends approximately $3 trillion on healthcare per year. While healthcare costs in the country are high across the board, Florida residents pay more than average. According to the Commonwealth Fund, the state is one of five in the U.S. where the average resident spends 14% or more of their income on healthcare. Insurance companies charge higher premiums to cover the high cost of medical expenses in the state.
If you’re charged with a DUI, multiple at-fault accidents or another severe driving violation, you’ll be required to purchase SR-22 in many states. Rates for these policies are significantly higher than the average policy. However, Florida extends additional penalties to drivers with a DUI. Instead of an SR-22, these drivers must file an FR-44, which requires that they purchase coverage with 100/300/50 limits, in addition to $10,000 in PIP coverage.
The high rates associated with this additional filing may contribute to why car insurance rates in Florida are so expensive. On average, a driver with a clean record pays $1,379 annually for car insurance. In comparison, a high-risk driver pays $861 more each year.
Although drivers in Florida are legally required to have insurance, 20% don’t carry coverage — much higher than the 12% national uninsured driver rate. Florida ranks sixth of the states with the highest rate of uninsured drivers, meaning the likelihood of being involved in an accident with someone who doesn’t have insurance is higher than in other states.
Although it's not part of the state's minimum insurance requirements, purchasing uninsured motorist insurance is encouraged. This coverage pays for your damages if you're in an accident with an uninsured driver. Because this coverage must be purchased at an additional expense, it increases the state's total insurance costs.
The Rate of Uninsured Motorists in Each State
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- StateUninsured Driver Rate
- District of Columbia19%
Severe Weather Risks
Extreme weather conditions are common causes for auto insurance claims, particularly for drivers whose policies include comprehensive insurance. Several weather hazards commonly experienced in Florida — including tornadoes and hurricanes — can damage your car to the extent that your insurance company might declare it a total loss. In these instances, providers have to pay out large claims. The frequency of these occurrences is a significant part of why car insurance in Florida is so expensive.
Average Age of Drivers
Age is one of the key factors providers use to determine car insurance rates. On average, young students and seniors pay more than the average driver for coverage. Florida’s relatively large population of people in both these age groups contributes to high overall insurance costs in the state. According to Census data, the collective population of people aged 18–24 and seniors in Florida is 17.7%, or 1.5% higher than the national average.
Car Insurance Rate Increases in Florida
Presently, the average driver in Florida pays approximately $2,208 per year or $184 per month for full coverage car insurance. In the last six years, auto insurance rates in Florida have steadily increased — according to MoneyGeek’s rankings, it moved from being the 43rd most-affordable state for coverage to the 46th. On average, rates in the state have increased by $379 since 2015.
How to Save on Car Insurance in Florida
Since it's so rare to find affordable car insurance in Florida, it’s beneficial to be aware of the different ways you can reduce your premium. MoneyGeek outlined some steps you can take to make insurance in Florida more affordable.
Shop around for quotes.
One of the best ways to find the lowest possible rates is to compare car insurance quotes from at least three providers. Carriers may consider common factors when setting premiums, but they each calculate rates differently. Provide the same information for each quote to see which insurance company offers the best rates for your needs.
Try bundling your policies.
Insurance companies often offer insurance for more than just cars. For example, bundling your auto insurance policy with your homeowners insurance could allow you to get much lower rates than you would if you purchased your policies from different carriers.
Take advantage of discounts.
Every insurance company has several discount programs available for buyers. Some center on safety, such as discounts for having anti-theft devices installed in your vehicle or a clean driving record. Others even offer discounts if you switch from a different carrier. Remember, though, that not all discounts are available in all states or with all carriers. Contact each prospective insurer directly to see which savings opportunities you qualify for.
Use an insurance comparison tool.
It's a good idea to use a car insurance comparison tool to get multiple quotes fast. These tools allow you to make side-by-side comparisons without going to different sites to get quotations. The downside, though, is these tools may not give you all available options for your policy. That said, they’re an effective way to narrow down your choices and take less time and effort to look for estimates.
Increase your deductible.
Your deductible plays a significant role in your auto insurance rates in Florida. It’s the amount you pay out of pocket each time you file a claim before your provider begins to cover your expenses. Having a higher deductible often translates to a lower premium — however, keep in mind that this also means you’ll pay more out of pocket after an accident.
Consider pay-per-mile insurance.
Typical car insurance policies use statistics about your age, driving history, location and other factors to determine your premium. While pay-per-mile insurance also takes these factors into account, it is largely usage-based, meaning your rates are based on the number of miles you drive. This insurance is an affordable option if you don’t drive often.
About the Author
- Insurance Information Institute. "Facts + Statistics: Uninsured Motorists." Accessed August 19, 2021.
- Visit Florida. "Research FAQ — How many visitors came to Florida last year?." Accessed August 19, 2021.
- Blue Cross Blue Shield. "Why Does Healthcare Cost So Much?." Accessed August 19, 2021.
- Spectrum News. "Weather Blog: Here are the Biggest Weather Hazards in Florida." Accessed August 19, 2021.
- United States Census Bureau. "Age and Sex." Accessed August 24, 2021.