The average driver in the U.S. pays $1,424 per year for a full coverage policy with 100/300/100 limits. However, the cost of car insurance in New York is much higher — there, the average driver spends $3,433 annually for coverage. The state is rivaled only by Michigan for the most expensive insurance premiums in the country. Insurance premiums in New York have no sign of slowing down, with a 14.2% increase in costs over the past six years.
Factors such as high healthcare costs and additional insurance requirements contribute to why car insurance is so expensive in New York. Because of this, MoneyGeek recommends that drivers compare quotes and shop around to find affordable car insurance in New York.
The average cost of car insurance in New York is $3,443, more than double the national average of $1,424.
New York car insurance rates have increased 14.2% in the last six years and rank only second to Michigan.
Compared to other states, New York has more insurance requirements, such as wrongful death coverage, personal injury protection and uninsured motorist coverage. All these contribute to why car insurance in New York is so expensive.
Why New York Car Insurance Prices Are So High
In recent years, the average cost of car insurance has steadily increased across the U.S., and New York is no exception. Several factors contribute to this trend, including highway density, driver demographics and effects of extreme weather conditions.
MoneyGeek details these factors to help you understand why car insurance is so expensive in New York.
New York is a no-fault state, meaning you file a claim with your insurance provider after an accident, regardless of who is at fault. No-fault states tend to have additional insurance requirements like personal injury protection (PIP) insurance — also sometimes referred to as no-fault insurance — to ensure drivers are adequately covered after an accident. These additional coverages increase the overall cost of insurance for drivers in the state.
Expensive Healthcare Costs
Healthcare is expensive across the United States, but costs are even higher in New York. According to a 2017 study conducted by the NYS Health Foundation, New York residents paid the eighth highest insurance rates in the country.
When healthcare costs are high, insurance companies pay out more in claims to cover the cost of treating injuries. Insurance carriers then set higher policy premiums to compensate for these higher-than-average healthcare expenses.
Extra Insurance Requirements
Auto insurance is required to register and operate a car in most states, including New York. New York’s minimum insurance requirements have the following limits:
- $10,000 for property damage per accident
- $25,000 for bodily injury and $50,000 for death per person in an accident
- $50,000 for bodily injury and $100,000 for death or all people in an accident
Drivers must also carry PIP and uninsured motorist insurance in the state.
These coverage requirements are above what is typically seen in most states, which tend only to require some form of liability-only coverage. Because the number of coverages included in your policy increases your premium, these requirements contribute to why car insurance is so expensive in New York.
Severe Weather Risks
New York is part of the Mid-Atlantic region, along with New Jersey, Pennsylvania, Maryland, Delaware and Washington DC. This region is at high risk of hurricanes and winter storms.
Winter storms, which typically happen between end-October and April, make even the safest roads dangerous. Hurricanes increase the likelihood of flooding, which may result in a total loss. Both severe accidents and total losses are costly for insurance companies to pay out; carriers mitigate these events' financial risks by charging more expensive premiums.
Higher Risk of Theft or Vandalism
Neighborhood crime rates affect the average car insurance cost in New York. Areas where theft or vandalism is more frequent typically have higher rates because people are more likely to file claims there. Currently, New York City is considered safer than just 26% of all cities in the United States. Buffalo and Rochester, the second and third-largest cities in the state, are considered safer than only 6% and 7% of other cities, respectively.
Car Insurance Rate Increases in New York
The average cost of car insurance in New York is $3,433 per year or approximately $286 per month. Car insurance rates in New York have increased in recent years. From 2015–2021, premiums in the state went by $485 or 14.2% on average.
How to Save on Car Insurance in New York
While it may be difficult to find affordable car insurance in New York, there are several steps you can take to find lower rates. MoneyGeek recommends using these strategies to help you get more affordable car insurance rates in New York:
Compare rates from different providers.
Comparing rates from various providers increases the likelihood you’ll find more affordable car insurance rates in New York for your needs because premiums vary from carrier to carrier. Make sure you ask about all insurance requirements in New York — not just the typical liability insurance, but PIP and uninsured motorist coverage as well.
Purchase multiple policies from one provider.
Some insurance companies allow you to bundle your homeowners, renters and auto policies. MoneyGeek found that purchasing multiple types of policies from the same provider could save you up to $833 per year.
Check out available discounts.
Car insurance providers offer several discounts. If you have a clean driving record, ask your carrier about safe-driver discounts. Other companies lower rates for installing safety devices in your vehicle. Available savings vary by state and provider, so be sure to ask all prospective providers what discounts you currently qualify for.
Use a comparison tool.
Using a car insurance comparison tool allows you to see a side-by-side comparison of rates from multiple companies simultaneously. These tools can be an effective way to filter your options and narrow down your choices. However, keep in mind that online comparison tools won’t factor in discounts. Once you’ve narrowed down your search, reach out to your top providers directly to learn more about the savings available to you.
Raise your deductible.
Policies with higher deductibles typically have lower premiums. Although raising your deductible requires you to pay more out of pocket each time you file for a claim, you’ll pay less per year for car insurance.
Consider pay-per-mile insurance.
You may want to consider pay-per-mile coverage if you don’t drive regularly but still own a car. Carriers use the number of miles you drive to calculate what you pay in monthly premiums — the less you drive, the lower your insurance costs.
About Mark Fitzpatrick
- American Red Cross. "Common Disasters Across the U.S." Accessed August 23, 2021.
- Neighborhood Scout. "New York, NY Crime Rates." Accessed August 23, 2021.
- Neighborhood Scout. "Buffalo, NY Crime Rates." Accessed August 23, 2021.
- Neighborhood Scout. "Rochester, NY Crime Rates." Accessed August 23, 2021.
- NYS Health Foundation. "Health Care Spending in New York Growing Faster Than Rest of U.S." Accessed August 31, 2021.