Texas insurance is unfortunately known to be expensive. The average cost of auto insurance in the United State is about $1,517 a year, which is around $126.41 a month. The average cost of auto insurance in Texas is substantially higher, at about $2,050 a year (around $170.83 a month), making it the fourth most expensive state for auto insurance.
There are many reasons for car insurance premiums to rise. Some of these have to do with the state itself while others influence individual car insurance premiums.
State Related Factors
Texas is one of the largest states in the United States with the second highest population in the nation. Having more drivers on the road increases the likelihood of a crash. Car insurance rates are determined based on risk and the likelihood of a claim being filed. More accidents mean more claims, which means higher premiums.
Rate Of Accidents
Texas is also known for having a high rate of accidents. In 2018 alone, Texas saw around 3,642 traffic-related deaths, 3,305 of which were fatal crashes. This placed it second behind California for highest amount of fatal crashes in the United States.
Laws And Trends
Texas laws are also responsible for premiums, though not directly. The highway speed limits in Texas are the highest in the United States at 85 miles per hour in some areas. Along with fast highways there is a long commute time for many drivers in Texas. The state is huge, and some cities in Texas have longer commute times than other cities in the United States. Drivers traveling long distances tend to pay more in insurance rates. Texas has many rural areas that require residents to drive long distances.
There is also a large amount of drivers in Texas who don't carry insurance, which increases the likelihood of insured drivers filing a claim for uninsured motorist. Drivers in Texas must carry a certain amount of liability insurance, which is higher than most states. Texas car insurance requirements include:
- $30,000 in bodily injury liability per person
- $60,000 in bodily injury liability per accident
- $25,000 in property damage liability
Texas has the most frequent variety of natural disasters in the country. Floods, hail, hurricanes, fires and more threaten various parts of the state. This is in part due to the state's location and size — as some areas of Texas are close to the coast while others are dry grasslands.
You have no control over the state factors that influence car insurance rates, but there are other factors that drivers can control. The average cost of car insurance accounts for all these factors, so you may pay much less than the average premium in Texas.
A driving record is one of the biggest personal influences on car insurance premiums. Having a poor driving record shows an insurance company that you may be likely to file a claim again or that you are high risk of an accident, so you will have to pay higher insurance premiums. In most states, such violations as DUIs go away after 10 years. In Texas, DUI and DWI convictions may stay on your record indefinitely. These violations can raise your premiums by 80 percent or more, which is over $1,000 more a year.
Many car insurance companies consider credit score when calculating insurance premiums. Your credit score is a way for the insurance agency to see how dependable you are in paying your insurance premiums. Higher premiums are a way to compensate for potential loss.
Be sure to ask your All Americas Insurance agent about discounts to save money on car insurance in Texas.
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