5 Least Expensive US States for Car Insurance and Why They Are the Least Expensive

5 Least Expensive US States for Car Insurance

Whether you have just bought a car, or you have one already. You have to pay attention to your car insurance. Car insurance is the most important investment you will make when it comes to your car. This is because it protects you from potential losses.

You may think that you don’t need it because it’s costly, however, it’s required by law and you can’t evade it. The price of car insurance is a huge factor that determines whether someone will buy car insurance online or not.

Some people don’t pay car insurance because of its high costs in that state. You should keep in mind that however much there are states with high car insurance premiums, there are others that have cheap car insurance.

There are a lot of things that determine the cost of car insurance online including your driving history, age, or the type of car you drive. But the extremely important one is the state that you live in.

The five least expensive US states for car insurance include;

RankStateAverage Rates
2New Hampshire$985



Maine has been one of the states with cheap car insurance online for years now. Because it is a rural state, it has fewer vehicles, and the likelihood of accidents and thefts is less hence reducing the need to get car insurance.

Another reason why car insurance is cheap in Maine compared to other states is because of the low rate of uninsured drivers and motorists. This is because it has a low population density. IRC reported that Maine has the lowest uninsured driver rate in the US at a percentage of 4.5% of the whole of its driving population.

As stated by Judi Watters, a consumer outreach specialist at the Maine Bureau of Insurance, Maine’s insurance rates have remained low mainly because of its low rates of losses. Its competitive market has also contributed to its low insurance premiums.

New Hampshire

With an average insurance rate at $985, it’s the second least expensive state in the US. This state doesn’t require its residents to have car insurance. Drivers are however required to pay for any costs incurred due to injuries or property destroyed during an accident.

Therefore, as a resident of New Hampshire, you are not required to buy car insurance, but you have to show funds indicating that you are financially responsible. It is then better to have car insurance already in place. Hence in times of accidents, if you have no insurance, you have to prove that you have enough funds to cover any losses incurred.


With an average rate of $1,034, Ohio has been one of the cheapest states for car insurance for years now. It is the third least expensive state in the US. This is because of the highly competitive rate of insurers. You can choose from a variety of car insurance policies and companies.

The state of Ohio doesn’t experience disasters as often as other states. It isn’t a rural state like Maine and New Hampshire, but it has one of the cheapest auto insurance rates because of its competitive insurance marketplace making it easy to shop around and find appropriate insurance rates.

The Ohio Department of Insurance protects its customers by providing stability in its marketplace hence the number of providers influences the cost.


Despite being America’s Dairyland, Wisconsin should also be famous for its low insurance rates. With an average of $1,049, it is the fourth-least expensive state in the US.

Wisconsin is a rural state with a moderate number in population density since it ranked 25th in the country hence its car insurance marketplace is quite competitive. This means that its overall auto-insurance rates are low.


With its car insurance average rate at $1,062, it is the fifth least expensive state in the US. As a predominantly rural state, with a competitive car insurance marketplace, Idaho has low insurance rates because most drivers are insured and only 8% of them are uninsured hence making it more affordable.

Idaho doesn’t have that many natural disasters when it comes to its weather like other states hence its low insurance due to the reduction in claims.

Why Is the Car Insurance Cheap in These States?

There is no one specific reason that car insurances vary from state to state, there are different factors that determine why a particular state has low insurance rates compared to other states that have high premiums. You should therefore put this into consideration when looking for car insurance quotes online and the different reasons include;

  • Your State’s Car Insurance Laws.
  • The level of traffic. The above states have considerably low insurance rates because there is no traffic congestion.
  • States with milder weather have low insurance rates while those that experience constant floods and hurricanes have high insurance costs. The above states don’t have such issues.
  • Your state’s economic situation. Some states have high rates of unemployment and poverty that leads to high insurance rates.
  • The number of uninsured and under-insured drivers. If the state you live in has low rates of uninsured drivers, the insurance rates also tend to reduce.
  • It also depends on the levels of competition. In states that have healthy competition between carriers, the car insurance rates tend to reduce significantly like Ohio.

Key Takeaways

  • Car insurances vary from state to state.
  • Remember that your car insurance may drop significantly when you decide to move.

All in all, it is extremely important to assess your state’s car insurance rates before you buy car insurance online. Some have low insurance rates while others have high insurance rates and this is because of several reasons as seen above.

Car Insurance Advisor content is not written by a licensed  insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for your situation