Auto Insurance Too Expensive for Many Drivers

Car accidentUnder the law, Massachusetts drivers must purchase auto insurance before they get behind the wheel. But this is not always cheap. A new study reports auto insurance has become too expensive for 19 million Americans, making it important to shop around so you can find the most coverage for your budget.

The report, “Study on the Affordability of Personal Automobile Insurance,” was released in January by the Federal Insurance Office of the United States Treasury. The Federal Insurance Office (FIO) was created by Congress with the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The office is charged with monitoring consumers’ access to affordable insurance products.

The report found basic liability automobile coverage is unaffordable in 845 zip codes where 19 million people live. Households in those areas had average auto insurance costs which exceeded more than 2 percent of average household income.

Massachusetts is the 10th most expensive state for car insurance, according to the Insurance Information Institute. Drivers pay on average $1,007 per year. New Jersey drivers pay the most nationally, with an average expenditure of $1,254.

The cheapest place to drive is Idaho. On average, drivers there pay just $553 for insurance.

Take time to understand your insurance policy. Before you buy car insurance in Massachusetts, remember these points:

Check out our chart. We have developed this chart and article, “Understanding and Buying Auto Insurance in Massachusetts.”

How much insurance do you need? Drivers must purchase Compulsory Coverage, which includes Bodily Injury to Others, Personal Injury Protection (PIP), Bodily Injury from an Uninsured Driver and Damage to Another Person’s Property. But you should also purchase Optional Coverage. Read more about the different types in our article, “Understanding and Buying Auto Insurance in Massachusetts.”

Underinsured and uninsured coverage. While these fall under Optional Coverage, they are essential. Far too often, drivers do not carry enough insurance of their own or outright ignore the law and do not buy insurance. In these cases, you will need to look to your own Underinsured and Uninsured coverage.

Discounts. You may be eligible for a discount if you purchase your auto insurance and homeowners insurance policies through the same carrier. Auto clubs may also offer discounts.

Cycling accidents. If you are a cyclist, you can purchase coverage to protect yourself in a bicycle accident through your auto insurance policy. It may cost more, but it is worth the investment. Many drivers do not carry enough insurance and you may have to turn to your own policy for compensation.

Shop around. This is your right. Massachusetts deregulated the auto insurance market in April 2008, giving drivers the freedom to research the market and find the best policy for their needs. Pay attention to deductibles; often that is where consumers can negotiate lower rates, but you will usually end up paying a higher deductible if you are found at fault for a car accident.

Factors which may increase your cost. Your age, the type of car you drive and the town where you live can all impact the cost of your auto insurance policy. Before you buy your next car, check in with your agent first.

About Breakstone, White & Gluck
The lawyers at Breakstone, White & Gluck have over 100 years combined experience representing those who have been injured in car accidents. If you have been injured, learn your rights. For a free legal consultation, contact 800-379-1244 or 617-723-7676 or use our contact form.