The 10 most affordable states for car insurance

Q: What is the most expensive state for car insurance?

The most expensive state for car insurance is New York. The average premium in New York is about 50% more expensive than the U.S. national average rate. Other states with expensive car insurance include Louisiana, Florida, Delaware, and New Jersey.

Car insurance premiums are personalized to each individual based on a variety of criteria. However, your location is one of the biggest factors that will affect your rate. The average cost of car insurance is cheaper in certain states because of location-specific factors – like weather risks, the number of uninsured drivers on the road, and the population density.

In this guide, we’ll look at the top 10 cheapest states for car insurance and explain why some states have less expensive auto insurance than others.

Why you can trust Rate Retriever

Our rates are based on real results quoted to past users in the last 18 months. While we may partner with some of the carriers you see on our site, we maintain editorial independence and it does not affect the rates you see. Read more about our rating methodology or see our rigorous editorial policy.

States with the cheapest car insurance

Certain states have more affordable car insurance rates than others. According to our data, the least expensive car insurance states include Vermont, Maine, and New Hampshire. These states have average rates that are well below the U.S. national average of $2,505 per year for full coverage.

Understanding the average cost of auto insurance in your location can give you an idea of what you might pay for coverage. However, it’s still a good idea to get personalized rate quotes from several insurers to find the cheapest policy.

You can compare insurance rates near you using our comparison tool and find the most affordable policy for your location and situation.

Which state has the lowest insurance rates?

Based on our analysis of available rate data and our users’ searches, Vermont has the cheapest auto insurance in the U.S. The average full coverage insurance premium in Vermont is $1,023 per year, which is about 60% less than the U.S. national average rate of $2,505 per year.

The 10 most affordable states for car insurance

Location has a significant impact on the cost of your car insurance. Some of the most affordable states for car insurance are Vermont, Maine, New Hampshire, Alaska, and Hawaii. Below, you can see the top 10 states with the cheapest car insurance and their average annual rates for a full coverage policy:

	Top 10 Cheapest States for Car Insurance
1.	Vermont	$1,023
2.	Maine	$1,308
3.	New Hampshire	$1,414
4.	Alaska	$1,465
5.	Hawaii	$1,494
6.	Ohio	$1,602
7.	Indiana	$1,610
8.	Wisconsin	$1,630
9.	Montana	$1,652
10.	Alabama	$1,755

Car insurance in Vermont

Vermont is the cheapest state for car insurance in 2026, according to our data. The average premium in Vermont is $1,023 per year. One of the reasons why Vermont has cheap car insurance is because it has a very low population density. It’s also largely rural, which contributes to low car insurance rates. With few drivers on the road at any given time, the risk of an accident goes down, and so does the average cost of car insurance in the state.

Car insurance in Maine

Maine is the second-cheapest state for auto insurance with an average annual premium of $1,308 per year. There are many reasons why car insurance in Maine tends to be so inexpensive compared to other states. Reasons may include its low population density, fewer urban areas, minimal traffic congestion, favorable state regulations, and beneficial competition among insurers.

Car insurance in New Hampshire

New Hampshire is the third-cheapest state for auto insurance, with an average annual premium of $1,414.

Car insurance in Alaska

Alaska is the fourth-cheapest state for auto insurance with an average annual premium of $1,465 per year.

Car insurance in Hawaii

Hawaii is the fifth-cheapest state for auto insurance with an average annual premium of $1,494 per year. Hawaii often enjoys lower car insurance rates, mostly due to favorable state regulations.

Why some states have less expensive insurance than others

Car insurance companies consider a variety of factors to calculate car insurance rates in a specific location. For example, the population density, the number of uninsured drivers, and the number of accidents in the area are just a few of the criteria that can contribute to the cost of car insurance.

Auto insurance companies also consider the number of claims that drivers file in specific locations. For instance, if thousands of drivers start filing vehicle theft claims, insurance companies might raise rates for drivers in that state. Similarly, if drivers continuously file weather-related claims in a certain state, rates might go up due to increased damage risks.

The amount of car insurance that is required in the state can also affect the average premium. In states that have low minimum coverage requirements, car insurance rates can be more affordable. Conversely, in states that have higher coverage requirements, car insurance premiums can be more expensive.

Keep in mind that the average cost of car insurance isn’t just determined by your state. Insurance companies also look at your city and ZIP code when calculating your personalized rate. Even if you live in a state with low car insurance rates, you could pay more than the statewide average based on your specific location.

FAQs

Where is car insurance least expensive in the US?

Vermont is currently the least expensive state for car insurance in the U.S. The average full coverage premium in Vermont is $1,023 per year or about $85 per month. Other states with affordable car insurance include Maine, New Hampshire, Alaska, Hawaii, and Ohio.

What is the most expensive state for car insurance?

The most expensive state for car insurance is Louisiana. The average premium in New York is about 85% more expensive than the U.S. national average rate. Other states with expensive car insurance include New York, Florida, South Carolina, and New Jersey.

Who has the cheapest car insurance in the USA?

There isn’t a single cheapest car insurance company for every driver. Car insurance companies charge different rates, even for the same type of coverage. Additionally, your premium is based on unique factors, like your age, credit score, driving record, vehicle type, and deductible. The best way to find the cheapest car insurance company for you is to compare rates from several insurance providers.

Compare how much insurance costs at the top insurance companies near you

Quick | No Phone or Email Required | Reliable Results

"*" indicates required fields

About Rate Retriever

At Rate Retriever, our mission is to make the way you shop for insurance transparent and fair through user-friendly tools that respect your privacy and deliver reliable, comprehensive results.

So we took everything we hated about comparing insurance quotes online – the spam, the long questionnaires, the limited choices, the inaccuracy of quote prices – and threw it out the window, favoring a quicker form that more accurately estimates what you’ll pay at each of the top insurance providers near you.

Rate Retriever is an independent company that is not owned by an insurance provider, nor do we provide insurance ourselves. This independence allows us to be your free and impartial insurance research tool, helping you make the best decisions for your insurance needs.

We may earn a commission when you click one of the links, buy a policy, or call one of the providers listed on our site; however, we do not allow our partnerships to influence which information we provide in our guides.