You have probably watched the catchy advertisements from car insurance companies like GEICO, Progressive, and Farmers that guarantee the cheapest rates. So you just need to pick the one with the best commercial, right?
That is not the case, however, as there are a whole bunch of unknowns like if you are a man or woman, if you have any tickets or accidents, and the neighborhood you live in, that all impact the cost of your policy. In this article, we will cover the best ways to save on auto insurance and will give you a good start in finding the cheapest car insurance in Michigan.
Shopping around for cheap auto insurance is confusing at best, and figuring out which company has the lowest-priced insurance rates for young drivers requires even more shopping around.
Each insurer has a unique approach for filing rates in each state, so let’s begin by examining the insurance companies with the most affordable rates in Michigan.
Best Insurance Companies for Teens
|Rank||Company||Cost Per Year|
|7||Pioneer State Mutual||$1,488|
|18||Auto Club Group||$2,464|
|Find Cheaper Rates Go|
USAA has some of the best car insurance rates in Detroit at around $978 annually. GEICO, Safeco, MetLife, and Chubb also rank well as some of the lowest-priced Detroit, MI auto insurance companies.
As illustrated above, if you currently have a policy with Chubb and switched to GEICO, you might achieve yearly savings of around $425. Drivers with MEEMIC may save as much as $447 a year, and Pioneer State Mutual insureds might realize rate reductions of up to $485 a year.
It’s important to note that these rates are averages for all types of drivers and the different vehicles they drive and and are not calculated with an exact vehicle garaging location for young drivers. So the auto insurance company that has the cheapest price for you may not even be in the list above. That underscores the importance of why you need to quote rates from as many companies as possible using your own specific driver and vehicle information.
For youthful drivers, one of the big factors that are looked at to determine the annual cost of car insurance is where you live. Larger areas likely pay more, whereas areas with less congestion tend to receive slightly lower rates.
The information below ranks the most expensive cities in Michigan for young drivers in which to buy car insurance. Detroit shows up at #1 having an annual price of $5,009 on average, which is around $417 monthly.
|Rank||City||Premium Per Year|
|11||St. Clair Shores||$2,819|
|Compare Rates Now Go|
Price information shown is comparative as the vehicle garaging location can alter coverage prices considerably.
Does full coverage make sense?
Finding cheaper insurance is important to most people, and one of the quickest ways to pay less for insurance for young drivers is to not buy full coverage. The diagram below shows the difference between insurance prices with and without full coverage. The data assumes no claims, a clean driving record, $100 deductibles, single status, and no policy discounts are applied.
Averaged out for all age groups, comp and collision coverage costs $3,933 per year more than buying just liability insurance. That amount may make you wonder if full coverage is worth the money. There is no clear-cut formula for eliminating full coverage on your policy, but there is a broad guideline. If the yearly cost of full coverage is more than around 10% of the vehicle’s replacement cost less your deductible, then you may need to consider dropping full coverage.
For example, let’s say your vehicle’s claim settlement value is $7,000 and you have $1,000 physical damage deductibles. If your vehicle is totaled, the most your company will settle for is $6,000 after you pay the deductible. If you are paying in excess of $600 annually for full coverage, then you might consider buying liability only.
How careless driving impacts insurance rates
The easiest way to find low insurance rates in Detroit for youthful drivers is to drive carefully and avoid accidents and violations. The example below illustrates how speeding tickets and at-fault accidents can drive up car insurance costs for each different age category. The data is based on a married female driver, full coverage, $250 deductibles, and no discounts are applied to the premium.
The data charted above shows the average cost of an auto insurance policy in Michigan per year with no accidents or violations is $3,769. Get two speeding tickets and the average cost jumps to $5,377, an increase of $1,608 each year. Now throw in two accidents along with the two speeding tickets and the 12-month cost of insurance for young drivers jumps again to an average of $11,266. That’s an increase of $7,497, or $625 per month, just for not paying attention while driving!
Ideas for buying budget-friendly auto insurance for young drivers
Lowering your rates is not difficult, and here are some of the better penny-pinching solutions that can help you quote more affordable car insurance.
- Home or renters coverage can save on auto insurance
- Avoid price increases by not filing claims
- Buy vehicles with five-star safety ratings
- Drivers with good credit ratings often pay less
- Older vehicles may not need full coverage
- Increase the comprehensive and collision deductibles on your policy
- Comparison shop at least once a year
The last suggestion is notably critical, as we stressed in this write-up. Car insurance rates can be modified anytime, so drivers shouldn’t be reluctant to switch carriers if a lower price can be found.
Brand loyalty is not necessarily bad, but it’s not a good idea if it’s costing you major coinage every year. Take a few minutes and compare rates and find cheaper auto insurance for young drivers in Detroit.
If you have coverage questions and would like to have some professional guidance when trying to find the best insurance rates for young drivers, the insurance agencies below can answer your questions and help you decide which insurance coverage will be best for you. To find an agent in your neighborhood, click the button link following the list.
Charlotte Knight – State Farm Insurance Agent
7100 W Seven Mile Rd – Detroit, MI 48221 – (313) 340-9000
600 Renaissance Center # 2100 – Detroit, MI 48243 – (313) 393-6800
13600 W 8 Mile Rd C – Detroit, MI 48205 – (313) 521-0300
Detroit L.A. Insurance
13545 W Seven Mile Rd – Detroit, MI 48235 – (313) 340-4444