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Michigan has most expensive auto insurance, U of M study finds
Stephen Borowy Posted Mar 22, 2019 0
A recent study from the University of Michigan claims that our state has the most expensive auto insurance in the country.
The study said premiums in 97 percent of Michigan’s ZIP codes exceeds the federal government’s definition of affordable.
The U.S. Treasury Department’s Federal Insurance Office deems auto insurance unaffordable in areas where premiums exceed 2 percent of the ZIP codes’ average household income.
In Detroit, average rates are between 12 and 36 percent of residents’ pre-tax income in close to every ZIP code.
The study said this burden is substantially greater for low-income communities.
Rates vary for those in Pontiac and Flint range from 8 to 24 percent of median income.
Drivers in Saginaw and Ypsilanti’s rates are 4 to 12 percent of the area’s median household income.
According to the study, the more affluent communities see the only affordable ZIP codes in the state including southeast Michigan, Dexter, Birmingham, Bloomfield Hills, and parts of Ann Arbor.
Royal Oak, Farmington Hills, and Livonia see rates above the affordability threshold, but these range from 2.1 to 4 percent of area median household income.
This study also found at 18 percent of pre-tax income, Detroit drivers spend more on insurance than drivers in other major cities. |
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