Why Is Car Insurance So Expensive In Florida?
It is no surprise to Florida residents that the cost of car insurance is rising. With rates at 46% higher than the national average, many Floridians are questioning why their car insurance is so expensive. While it is true that the price of car insurance has increased nationally, Florida is being hit particularly hard.
The reasons for the high cost of insurance can rarely be attributed to just one or two factors, which makes it difficult for most consumers to understand. However, being in the insurance industry for over two decades gives me some additional insight I can lend to this topic. Keep reading to learn more about why car insurance is so expensive in Florida.
Key Takeaways
Florida has severe weather, many uninsured drivers, and high rates of auto theft and fraud, contributing to the high cost of car insurance.
Drivers in Florida are more likely to hire attorneys than any other state, which can also drive up the cost of insurance.
Certain makes and models of vehicles are more prone to theft than others.
Getting quotes from other companies is often the best way to save money on your car insurance.
Why Is Car Insurance So Expensive In Florida?
Car insurance is more expensive in Florida due to a few different reasons. Specifically, the weather, the number of uninsured drivers, high rates of auto theft, and fraud, among other factors. These elements contribute to higher payouts for insurers and subsequently increased rates for consumers.
Unique Reasons Why Car Insurance In Florida Is So High
The cost of Florida car insurance can be attributed to the following reasons as noted below.
Severe Weather
It is well known that Florida gets hit with severe weather throughout the year. The National Oceanic and Atmospheric Administration (NOAA) cites 90 climate/weather events since 1980 that have affected Florida, with over $1B in damages. Flooding, freezing, wildfires, tornadoes, and other storms can cause vehicle damage, causing residents to file claims with their insurance companies.
Due to the high risk of weather-related damage, Florida car insurers charge more to offset the cost.
Uninsured Drivers
Most states require a minimum amount of insurance to drive legally, and Florida is no exception. However, despite this requirement, 20% of all Floridian drivers are uninsured, which is 66% higher than the national average. Drivers who do carry insurance are forced to cover the risk of being hit by an uninsured motorist by purchasing Uninsured Motorist coverage.
Carrying this additional coverage, and oftentimes at higher limits to ensure there are adequate funds available in a loss, increases the overall price of insurance.
Note: Insurers in Florida are legally required to offer Uninsured Motorist coverage to their insureds, and if you decide not to purchase, you must decline the coverage in writing. Although it is not required to have, I always recommend purchasing. Especially in Florida where the number of drivers without insurance is high.
Auto Theft
Florida is number three on the top 10 states with the highest number of auto thefts in the country. While the exact reason for the high number of thefts is unclear, the fact remains that Floridians pay more in insurance because of them. There are, however, specific makes and models of vehicles that are more prone to theft than others.
| Make/Model | Number of Thefts |
| Jeep Cherokee/Grand Cherokee | 481 |
| Honda CR-V | 545 |
| Ram 1500 | 608 |
| Honda Civic | 835 |
| Chevrolet Silverado 1500 | 930 |
| Toyota Corolla | 938 |
| Nissan Altima | 1,041 |
| Toyota Camry | 1,041 |
| Honda Accord | 1,058 |
| Ford F-150 | 1,876 |
Note: Installing an alarm system or keeping your car in a garage are ways to reduce the risk of car theft. In addition, most car insurance companies offer discounts for both, which can help save money if you own one of the above makes or models.
Insurance Fraud
According to the Insurance Research Council, 35% of Florida’s auto injury claims have the appearance of fraud, which is higher than the national average of 19%. As a no-fault state, Florida requires its drivers to carry at least $10,000 of Personal Injury Protection coverage. This coverage pays for medical bills that drivers or passengers sustain in an auto accident, regardless of fault, where each driver files through their own insurance.
Because the mandated limit for PIP is $10,000, it may incentivize dishonest insureds, doctors, or attorneys to inflate injuries for a higher payout. Unfortunately, Florida has no shortage of these scenarios. These instances of fraud drive up the cost of insurance as insurance companies try to recoup their losses.
Attorney Involvement
Florida drivers are 14% more likely to hire attorneys than drivers in other states. Whether this is due to Florida’s no-fault law or simply the litigiousness of society at large, the fact remains that attorney involvement increases the claim payout. Insurance companies then pass the cost onto policyholders in the form of higher premiums.
Healthcare Costs
The cost of healthcare has increased across the country. However, according to Forbes, Florida is in the top 5 states with the most expensive medical costs. Car insurance prices are higher to cover this increased cost.
Population Density
According to World Population Review, Florida is the 8th most densely populated state at 353.4 people per square mile. Additionally, Statista states Florida has over 16 million drivers. More people on the roadways can mean increased traffic and subsequently more accidents.
The number of people driving can also increase during certain seasons when tourism is higher, which can also impact insurance costs.
Factors Causing Your Car Insurance To Be So High
There are a number of factors that affect the price of your car insurance. Here are the most common ones that can influence your car insurance premium.
Insurance Company
While most insurance companies tend to use the same characteristics to determine what you’ll pay, each company weighs them differently. So what you pay with one company will be different than what you will pay with another. For this reason, it’s always a good idea to shop around to ensure you are getting the best price for you.
Coverage Type
Another factor that will impact how much you pay for your auto insurance is what coverages you choose. The higher liability limits you choose for Bodily Injury, Property Damage, Personal Injury Protection, and Uninsured Motorist coverage, the more you will pay. If you elect to carry comprehensive and collision coverages, you can expect your bill to be higher as well.
Age
Your age is another important consideration for car insurance companies. This is because the younger you are and the less experience you have on the road, the higher your risk of getting into accidents. As you gain more experience behind the wheel, your rates should start to decrease.
Note: Typically, car insurance rates tend to drop when drivers reach 25 years old. At this point, age will have less of an impact on car insurance prices until drivers hit their 70s. This is where most older adults begin to have poorer eyesight and slower response times, causing rates to increase.
Gender
Gender also affects the price of your car insurance. In general, men tend to pay more for their insurance than women as they are higher-risk drivers. However, in Florida, men pay $2,669 a year on average whereas women pay $2,720.
Location
The price of your car insurance will vary based on where your vehicle is primarily garaged. Insurance companies will charge more for riskier areas such as ones with higher crime rates or a higher number of car accidents. The areas that have fewer of these risk factors will often pay less.
Driving History
One of the largest impacts on your car insurance rates is your driving history. Drivers who have a history of accidents and traffic violations will pay more for their insurance because they are a higher risk to the insurance company. In Florida, high-risk drivers can expect to pay 32% more for their insurance than those with no prior accidents or violations on their record.
Credit Score
Florida is a state where credit score is allowed to be used to determine insurance rates. This means that your car insurance premium can be higher if you have poor credit. Drivers with bad credit can pay up to 47% more than those with an excellent score.
Note: If you have recently seen an increase in your credit score and have been with your auto insurance company for a few years, it may be worth asking for a re-score. A re-score can potentially lower your rates, especially if your score has improved since you purchased your policy.
Your Vehicle
The type of vehicle you are looking to insure will also have a large impact on what you pay. Some makes and models are safer to drive and can help prevent car accidents, which is why they are less expensive to insure. Others may be prone to theft and therefore cost more to insure.
How To Get Cheaper Car Insurance?
Despite Florida being one of the most expensive states to insure a vehicle, there are a few ways you can get cheaper car insurance. First, look for discounts. Some of the most common discounts available are as follows:
Good Driver Discount
This discount is offered to drivers who have been accident/violation-free for several years. The amount can vary by company but can range between 10%-30%.
Defensive Driving Discount
Drivers who take a defensive driving course can potentially save 10% on their insurance policies with certain companies.
Good Student Discount
Students who have a 3.0 cumulative GPA can earn between 5%-25% on their car insurance.
Multi-Policy Discount
If you have multiple policies with a company, you may be eligible for a multi-policy discount of up to 17%.
Affinity Discounts
For being part of a particular group, such as a professional organization or alumni, some companies may offer you a discount of between 3%-5%.
In addition to discounts, another way to get cheaper car insurance is to work on your credit score. Since Florida is a state where credit score is used to determine your insurance premium, you can save significantly by improving your score.
Drivers who have gone at least 3-5 years without any accidents or violations will also save money on their car insurance. Being mindful behind the wheel and staying free of infractions on your license will pay off in cheaper premiums.
Lastly, the best way to find cheaper car insurance is to shop around. Insurance companies all look at the same rating factors, but they weigh them differently or offer different discounts. So you may be able to find a cheaper price with another company.
FAQs
What should I do if my car insurance is too high?:
If your car insurance is too high, your best solution is to get quotes from other companies. Not only are you able to compare to ensure your rates are competitive, but you may even be able to get a cheaper price elsewhere.
Why did my car insurance rate go up?
There are several reasons why your rates may have gone up. Drivers may see rate increases if they have had any accidents or violations within the past year, or if they have made changes to their policy. But many will see rate increases simply due to factors outside of their control such as inflation, rising healthcare costs, increases in vehicle theft, or the number of uninsured drivers in their state.
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