Find out why Florida car insurance rates are among the highest in the country and how they are expected to increase in the coming year.
Tired of sticker shock when you look at your auto insurance premiums? Good news! Sort of. According to insurance comparison site Insurify, car insurance rates in Florida, which are already the third-highest in the U.S., are expected to rise again in 2024. However, the anticipated increase of 7% is much lower compared to the 24% surge experienced last year. Let’s dive deeper into the details and explore why Florida car insurance rates are so high and what you can do to potentially reduce your premiums.
Why are Florida Car Insurance Rates So High?
Several factors contribute to the high cost of car insurance in Florida. Severe weather events such as hurricanes, tornadoes, and flooding, along with the soaring cost of auto parts, have caused significant losses for insurers. Additionally, rampant insurance fraud and the withdrawal of some insurance companies from the state have further driven up the rates.
At the end of 2023, the average annual full-coverage rate in Florida was $2,917, or $243 per month. This amount is 44% higher than the national average and makes Florida the third-highest state for car insurance rates, following New York and Nevada. Moreover, full coverage rates in Florida represent 4.3% of the state’s median household income, which is lower than the national average of 2.6%. Despite this, the burden of car insurance remains substantial for Floridians.
Anticipated Rise in Car Insurance Rates
Insurify predicts that car insurance rates in Florida will rise to $3,121 in 2024, a 7% increase from the previous year. Nationally, the average cost of full coverage car insurance is expected to reach $2,160. These projections suggest that Florida’s car insurance rates will continue to outpace the national average.
Which States Pay the Highest Car Insurance?
Insurify’s database of 97 million car insurance quotes revealed the states with the highest full coverage car insurance rates. Here are the top ten states:
- New York: $3,374, or $281 per month
- Nevada: $2,975, or $248 per month
- Florida: $2,917, or $243 per month
- Delaware: $2,806, or $234 per month
- Louisiana: $2,792, or $233 per month
- Washington, D.C.: $2,756, or $230 per month
- South Carolina: $2,680, or $223 per month
- Maryland: $2,645, or $220 per month
- Michigan: $2,640, or $220 per month
- Rhode Island: $2,452, or $204 per month
The average cost of full coverage car insurance in the U.S. in 2023 was $2,019, or $168 per month. Florida is also tied for second place with New York for the highest percentage of household income allocated towards car insurance, both at 4.3%, trailing behind Louisiana at 4.7%.
Is Florida Considering Repealing No-Fault Car Insurance?
The high level of frivolous lawsuits and insurance fraud is one of the major factors driving up car insurance rates in Florida. To address this issue, there have been efforts to repeal the state’s no-fault system and the mandatory $10,000 in personal injury protection (PIP) coverage that has been in place since 1979. The proposed change would require motorists to carry $25,000 in bodily injury coverage for injury or death to one person and $50,000 for injury or death to multiple persons in the same accident. While proponents believe this repeal would reduce insurance rates by minimizing costly lawsuits and eliminating fraud, critics argue that it could disproportionately affect low-income Floridians who rely solely on PIP coverage and potentially increase the number of uninsured motorists on the road.
Other Legislative Efforts Related to Vehicle Insurance
Apart from the potential repeal of no-fault car insurance, there are a few other bills being considered in the Florida Legislature:
- HB 41: This bill aims to create a program where residents can apply for a one-time grant of up to $1,500 (or $2,500 for residents 65 and over) to cover mortgage loans, homeowners’ insurance, and motor vehicle insurance payments.
- HB 921: This bill proposes that the state contract with a Florida public university to study whether breaking regions away from metropolitan areas by ZIP code could reduce insurance rates. However, this bill was withdrawn before it was introduced.
While Governor Ron DeSantis has included breaks on taxes, fees, and assessments for residential property insurance premiums and exemptions on flood insurance in his proposed budget for 2024-2025, no specific mention of auto insurance was made.
How Can You Reduce Your Auto Insurance Premiums?
Insurify’s data shows that over 45% of drivers did not take any action to reduce their premiums in 2023. However, there are a few strategies you can consider to potentially lower your car insurance costs:
- Increase Deductibles: By opting for a higher deductible, you can lower your premium. Just be sure you can afford to pay the deductible if you need to file a claim.
- Lower Coverage Limits: Evaluate your coverage needs and consider reducing your coverage limits if you have comprehensive coverage and collision coverage.
- Remove Drivers: If there are drivers on your policy who no longer use your vehicle, consider removing them to potentially reduce your premium.
- Shop Around: Compare quotes from multiple insurance companies to find the best rate and coverage for your needs.
- Consider Alternative Coverage Options: If you drive an older vehicle, you may want to assess whether you still need full coverage. Switching to liability-only coverage can significantly reduce your premium, although it comes with a higher level of risk.
Remember, it’s essential to balance cost-saving measures with adequate coverage to protect yourself and your vehicle.
Q: Will Florida’s car insurance rates continue to rise in the future?
A: While it’s challenging to predict future trends accurately, car insurance rates in Florida have been consistently increasing. Based on Insurify’s projections, it’s likely that rates will continue to rise in the coming years.
Q: Can I expect any relief from high car insurance rates in Florida?
A: Efforts to address the factors contributing to high car insurance rates in Florida, such as the potential repeal of no-fault car insurance, could potentially lead to reductions in rates. However, the impact of these efforts remains uncertain, and it’s essential to stay informed about any legislative changes.
Q: Are there any additional bills being considered in the Florida Legislature that could impact car insurance rates?
A: Apart from the potential repeal of no-fault car insurance, there are a few other bills under consideration. One proposes a grant program for mortgage loans and insurance payments, while another aims to study the impact of breaking regions away from metropolitan areas by ZIP code. However, the status and outcomes of these bills are subject to change.
Q: What are some other ways to save money on car insurance in Florida?
A: In addition to the strategies mentioned earlier, you can also ask your insurance provider about potential discounts for safe driving, bundling policies, or completing defensive driving courses. Every insurer has different offerings, so it’s worth exploring all available options.
Q: How can I find the best car insurance rate in Florida?
A: To find the best car insurance rate in Florida, compare quotes from multiple insurance companies. Take into account factors such as coverage limits, deductibles, and customer reviews to ensure you are making an informed decision.
Florida’s car insurance rates are among the highest in the country, with further increases expected in the coming year. Severe weather events, insurance fraud, and the withdrawal of insurers from the state have contributed to the rising costs. While efforts are being made to address these issues, it’s essential for Floridians to explore ways to potentially lower their auto insurance premiums. By understanding the factors influencing rates and taking proactive measures, such as increasing deductibles, evaluating coverage limits, and shopping around for the best rates, you can find the right balance between cost savings and protection. Stay informed about legislative developments that may impact car insurance rates and adjust your coverage accordingly.
