Why Is Car Insurance So Expensive in Georgia? Factors & Solutions

June 12, 2024

Car insurance in Georgia is among the highest in the nation, with several factors contributing to its steep costs. The average cost of full coverage car insurance in Georgia is $1,638 per year, placing it among the top 10 most expensive states for auto insurance. For state minimum coverage, the average cost is $977 annually, or approximately $81.42 per month. These rates reflect a substantial increase of 16.8% from 2015 to 2020, although there was a slight decrease of 7.7% from 2020 to 2021.

Contributing Factors to High Costs

Dangerous Highways

Georgia's highways are particularly perilous, ranking fourth in the nation for fatal auto accidents. The increased traffic and accident rates lead to more insurance claims, prompting insurers to raise premiums. More accidents equate to higher risk, which is directly passed on to consumers in the form of increased insurance costs.

No Cap on Premium Increases

Unlike many other states, Georgia does not require insurers to obtain state approval for rate increases under 10%. This lack of regulation can lead to frequent and significant rate hikes, making insurance costs more volatile and prone to sudden increases.

High Healthcare Costs

The state of Georgia also has some of the highest healthcare costs in the U.S. Higher medical costs mean that insurers have to pay more per claim for medical expenses arising from accidents, contributing to the higher premiums drivers face.

Costly Auto Repairs

Auto repairs in Georgia are among the most expensive in the country. Insurers cover the high costs of these repairs, which subsequently drives up premium rates. As vehicle technology becomes more advanced, repair costs continue to soar.

Uninsured Drivers

Approximately 12% of drivers in Georgia are uninsured. This risk forces insurers to offer optional uninsured motorist coverage, which, while providing protection, also contributes to higher overall insurance rates.

Severe Weather Risks

Frequent severe weather events such as intense storms, tornadoes, and hurricanes lead to high-cost insurance claims. Insurers have to account for these risks, leading to increased rates for comprehensive coverage.

High Vehicle Theft Rates

Georgia ranks among the top five states for vehicle thefts. The high probability of insurers having to pay out for total loss claims due to theft significantly contributes to the high insurance costs in the state.

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Strategies to Save on Car Insurance

Shopping Around

One of the most effective ways to save on car insurance is to compare quotes from multiple insurers. This can help residents find the most competitive rates tailored to their specific needs.

Bundling Policies

Combining multiple insurance policies, such as home and auto insurance, can result in significant savings, with an average of 17% off premiums. Bundling offers consumers a convenient way to manage multiple policies while reducing costs.

Seeking Discounts

There are various discounts available that can help lower insurance costs. These include discounts for being a good driver, remaining accident-free, having low mileage, or owning a vehicle with safety features. It is beneficial for drivers to inquire about these potential savings with their insurers.

Comparison Tools

Using online car insurance comparison tools can help drivers quickly find the most affordable options. These tools take into consideration individual driving habits and insurance needs, streamlining the process of finding the best rates.

Raising Deductibles

Opting for a higher deductible can reduce premium costs. However, this also means paying more out of pocket in the event of a claim. Drivers should weigh the pros and cons of higher deductibles based on their financial situation and risk tolerance.

Pay-Per-Mile Coverage

Pay-as-you-drive insurance is a good option for those who do not travel frequently. This type of coverage only charges for the miles actually driven, offering significant savings for low-mileage drivers.

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